Additional Incentives Expected to Boost New Car Sales in Indonesia

KatadataOTO – The automotive industry faced many obstacles in the first three months of 2025. Making new car sales quite sluggish.

According to records from the Association of Indonesian Automotive Industries (Gaikindo), there were 205,160 new cars sent from factories to dealers, or what is commonly called wholesales.

This number was recorded from January to March 2025. This achievement was a 4.7 percent correction compared to the same period last year.

This year, the government has provided incentives for electric and hybrid cars. Meanwhile, the domestic electrification market only accounts for five percent of total sales.

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Seeing this situation, providing additional incentives for conventional four-wheeled vehicles from the government is considered capable of reviving new car sales.

"Clearly, this regulation (incentive) is very helpful in boosting (the market)," said Donny Saputra, Deputy Managing Director of SIS (Suzuki Indomobil Sales) in Karawang some time ago.

Donny explained that the government has actually provided various stimuli. Such as luxury goods sales tax (PPnBM) cuts for the purchase of hybrid cars.

The incentive turned out to be quite helpful, but it has not yet had a significant impact on new car sales in the country.

Therefore, Donny said that Gaikindo is open if President Prabowo Subianto and his ministers want to provide additional incentives.

"It can be discussed with us at Gaikindo, or if there are new ideas from our government or regulator colleagues, we are open to that," Donny stated.

On the other hand, the sluggish condition of new car sales is also occurring in other industries. It is not only experienced by automotive manufacturers.

"We see the economic situation is like it is now. Not only in automotive, but several other industries are probably quite similar," Donny stated.

Proposal for New Car Prices to Decrease

Previously, the Minister of Industry (Menperin) gave special attention to the four-wheeled vehicle industry in the country.

"For the government, the decline must be an important note because the automotive contribution is very high,” said Agus Gumiwang Kartasasmita, the Minister of Industry, on a separate occasion.

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One of President Prabowo Subianto's aides also gave a number of suggestions for domestic manufacturers.

“We hope there will be new policies, for example, not a directive (like) sacrificing margins or lowering vehicle selling prices,” continued the Minister of Industry.

He hopes that with the suggestion above, it can revive new car sales in 2025.