Automotive Incentives Still Awaited to Boost Sales in 2026

KatadataOTO – The government has not yet given a signal regarding the provision of automotive incentives in 2026. Even though this assistance contributes to boosting sales.

Especially amidst weakening purchasing power and uncertain economic conditions, including in Indonesia.

The Association of Indonesian Automotive Industries (Gaikindo) even revised its 2025 sales target because the figures up to November were not satisfactory.

In the January-November 2025 period, sales of new cars at the retail level (distribution from dealers to consumers) were 739,977 units.

Photo: Chery

Meanwhile, wholesales figures, or distribution from factories to dealers, only reached 710,084 units. This is still far from Gaikindo's rather ambitious initial target of 900 thousand units.

It cannot be predicted for certain how long the weakening of purchasing power in the automotive sector will last. Therefore, certainty regarding incentives is still hoped for.

“We understand that the government will find the best way for the Indonesian automotive industry to continue to improve and grow more rapidly,” said Jongkie Sugiarto, Chairman I of Gaikindo, to KatadataOTO on Monday (15/12).

Throughout 2025, incentives have been a major contributor for electrified vehicles. Many electric cars could be sold at competitive prices, even dropping to the Rp 100 million range thanks to subsidies.

Incentives are also believed to be one of the main attractions for manufacturers to invest in Indonesia. However, this must also be accompanied by policy sustainability.

He was reluctant to specify a more detailed prediction for new car sales next year. However, it seems Gaikindo is waiting for the government to provide certainty regarding automotive incentives.

Photo: KatadataOTO

“We have not yet discussed the projections for 2026 with the members (Gaikindo),” said Jongkie.

On the other hand, automotive observers predict that new car sales in 2026 without incentives could only reach 700 thousand to 800 thousand units. Even then, it must be accompanied by economic improvement in 2026.

“This recovery is threatened because government policy signals are still contradictory, such as slow fiscal strengthening,” said Yannes Martinus Pasaribu, an automotive observer and academic from the Bandung Institute of Technology (ITB), to KatadataOTO some time ago.