BMW Welcomes IEU-CEPA Agreement to Take Effect in 2027

KatadataOTO – The government has just made an agreement, namely the Indonesia-European Union Comprehensive Economic Partnership Agreement (IEU-CEPA).

The agreement brings benefits to car manufacturers from the Blue Continent. This is because they receive a reduction in import duty costs.

BMW Group Indonesia has also spoken out about the IEU-CEPA agreement. They are asking for details of the new policy.

"Until now, all the details and the IEU-CEPA agreement have not been elaborated. It is still a broad framework without clear regulatory details," said Peter Sunny Medalla, President Director of BMW Group Indonesia in Jakarta, Friday (17/10).

Photo : Courtesy

Nevertheless, BMW still welcomes the agreement between Indonesia and European countries. This is because it is predicted to have a positive impact.

For example, a price reduction for BMW cars with Completely Built Up (CBU) status from Germany.

However, BMW estimates that this will not be immediately felt by consumers in the country.

The price reduction for BMW cars is predicted to occur gradually over the next five years.

Even so, the German brand urges consumers not to delay purchasing their products, especially not to wait for the IEU-CEPA agreement to take effect.

This is because the majority of BMW's four-wheeled vehicles sold in Indonesia are already assembled locally in the country.

"Most of our cars are actually in CKD form," Sunny said.

BMW emphasizes that their presence in the country is not just about selling four-wheeled vehicles at competitive prices.

But BMW also wants to invest in human resources and local industries, thus being able to have an impact on Indonesia's economic sector.

For your information, European car products in Indonesia are currently offered at quite high prices. Vehicle import costs are one of the contributing factors.

Therefore, this policy that reduces import duties for European cars can be a breath of fresh air for various manufacturers like BMW and Mercedes-Benz.

Photo : KatadataOTO

Considering that the majority of their vehicle lines are still CBU, meaning they are imported whole from their country of origin.

Furthermore, it was explained in the statement that the Indonesia-European Union agreement will also open up many investment opportunities in strategic sectors, including Electric Vehicles (EVs).

Considering that electric four-wheeled vehicles are currently receiving a fairly good response from consumers in the country.