H. Yoo
Research expert covering South Korea
Automotive industry in Indonesia- statistics & facts
Trailing only Thailand, Indonesia has become the second largest producer of motor vehicles within the ASEAN (Association of Southeast Asian Nations) region. Low labor costs and a low motorization rate have opened the door to an increasing number of car manufacturers, including Toyota, Nissan, and General Motors. In terms of automotive production by vehicle type, the Indonesian automotive industry has developed a preference for sturdy 4x2 vehicles. In recent years, Indonesia also started producing affordable energy-saving 4x2 vehicles.
In line with global trends, Indonesia is rapidly advancing its electric vehicle (EV) sector. The government has set the ambitious target of producing 600,000 electric vehicles by 2030. From 2024 onwards, sales of electric vehicles, including Wuling's Air EV, are expected to show promising growth, thanks to incentives such as tax breaks and support for domestic battery production. Despite infrastructure problems, Indonesia aims to position itself as a regional hub for electric vehicle production, hoping to capitalize on its vast nickel resources, crucial for battery production.
Japanese brands continue to dominate the Indonesian automotive market
The Indonesian automotive market remains heavily dominated by Japanese brands, notably Toyota, Daihatsu and Honda, which together control over 65 percent of retail market share. PT. Astra International Tbk remains the main distributor of these brands. At the same time, Chinese brands, particularly Wuling, have expanded their market presence by meeting the needs of budget-conscious consumers with competitively priced models and tapping into the fast-growing electric vehicle sector. Wuling's Air EV Long Range, for example, ranked as the second most sold electric vehicle in Indonesia. German brands such as BMW and Audi remain present in the luxury segment, with BMW reporting continued interest in its top-of-the-range models, particularly in large urban areas. Top models of BMW and Audi cars are shipped as finished automobiles (CBU - Completely Built Up), while other models are assembled on-site.Indonesia's automotive industry outlook
The automotive sector is one of the key pillars supporting the growth of the manufacturing industry and the national economy, supported by trade agreements and government incentives. The free trade agreement with neighboring Australia, launched in 2020, has enabled Indonesian manufacturers to increase exports, particularly to Australia, with a focus on energy-efficient models. The industry's growing export capacity is a sign of resilience and commitment to international quality standards.In line with global trends, Indonesia is rapidly advancing its electric vehicle (EV) sector. The government has set the ambitious target of producing 600,000 electric vehicles by 2030. From 2024 onwards, sales of electric vehicles, including Wuling's Air EV, are expected to show promising growth, thanks to incentives such as tax breaks and support for domestic battery production. Despite infrastructure problems, Indonesia aims to position itself as a regional hub for electric vehicle production, hoping to capitalize on its vast nickel resources, crucial for battery production.
