Airlangga Reveals Ongoing Study of Automotive Incentives for 2026

KatadataOTO – Airlangga Hartarto, Coordinating Minister for Economic Affairs, revealed that the government is currently reviewing the automotive incentive policy for 2026. According to him, this sector has actually already received significant fiscal support.

According to him, in the last two years, the government has provided up to IDR 7 trillion in automotive incentives. The results have been quite good, with a massive increase in electric vehicle sales.

"The automotive sector has been given incentives for the last two years, valued at IDR 7 trillion. Investment in the automotive sector, especially EVs, has also increased," said Airlangga, as reported by Antara.

He also added that several global electric vehicle manufacturers have now entered Indonesia. From VinFast to BYD, they have invested in Indonesia, following in the footsteps of Hyundai, which invested earlier.

Photo: KatadataOTO

Therefore, he believes a policy evaluation is necessary for the industry to continue to grow. The government wants to ensure that the next policy direction does not merely continue old incentives but truly supports the strengthening of the national automotive industry, including the development of a national car.

"So, in the future, this will be pushed for the (development of a) national car," added Airlangga.

Furthermore, regarding the follow-up proposal from the Ministry of Industry, Airlangga stated that discussions are still focused on a more fundamental review.

An evaluation is needed across segments, from low-cost green cars (LCGC) to electric vehicles and hybrid technology.

"Because the more substantial aspect means we must start with an evaluation from LCGC to EV, Plug-in hybrid, and hybrid. So, it's more comprehensive,” he asserted.

Suggestion From Toyota Indonesia

Meanwhile, Bob Azam, Vice President Director of PT Toyota Astra Motor Manufacturing Indonesia (TMMIN), provided input for the next program. According to him, the automotive sector needs the government to be bolder in taking counter-cyclical measures or providing stimulus when the economy slows down.

Photo: KatadataOTO

“We need a program that is a stimulus, not just a one-time incentive or disposable consumption. And the one with the greatest leverage is the middle class because if they are given a stimulus, the impact will be widespread,” he said in Bandung some time ago.

According to him, if the middle class is given space, they will have a more strategic role because their consumption can drive the economy more broadly, from the manufacturing industry and financing to the consumer supply chain.