Indonesia to relax import rules for completely built unit in electric vehicles segment

Indonesia enters the race for electric vehicles with a relaxation of the import rules for completely built units but some are unhappy this might stem the rise of locally produced EVs or car parts

To accelerate the entry of electric vehicles in Indonesia, the government of President Jokowi Widodo plans to allow manufacturers to bring completely built units or CBU parts.

With this plan, the government hopes the sale of these vehicles in the market will stimulate the buyers to own them.

But the chair of the Indonesian Automotive Industries Association (Gaikindo), Yohanes Nangoi criticised the move.  He reminded the government not to be careless in deciding on these issues that may cause the domestic automotive manufacturers to be unsettled.

He told Kompas the association is worried that with this policy, in 10 or 15 years, the country will import everything, thus disrupting the manufacturing process.

He said Gaikindo does not want the automotive industry to die.

Nangoi said if the goal is only to test or build a market, it is ok.  But there must be continued monitoring and supervising, he said.

Some people used the ‘do not buy a car in a sac’ terminology to describe the liberalisation of the importation of CBU cars.

They say the government should put a cap of two years for the importation of CBUs but must also promote the local manufacture of electric vehicles.

TOYOTA

According to Reuters, Toyota has to invest $2 billion in Indonesia over the next five years. Part of this commitment is to produce Electric Vehicles or EVs.

Indonesia is aiming to start producing EVs in 2022 with a number of companies disclosing plans to invest in this segment.

Indonesia is also pushing for the development of battery production facilities to create a downstream industry.

Hyundai is also in the race to build EV plants in Indonesia.

In January, Indonesia said it is finalising a new EV policy that will offer fiscal incentives to foreign car makers, as it ramps up efforts to become a lithium battery hub. -/TISG