Electric Car Incentives Deemed Not Yet Significant in Boosting Sales

KatadataOTO – The government provides electric car incentives in the form of a 10 percent Government-Borne Value Added Tax (PPN DTP) relaxation for models that are locally assembled and have a minimum of 40 percent Local Component Level (TKDN).

This has made the price of electric cars considered more competitive. Then there are reliefs for brands that import but with a commitment to local assembly in the form of import incentives, as currently enjoyed by BYD.

In fact, the price of BYD's newest electric car, the Atto 1, is around Rp 195 million on the road in Jakarta.

PT Toyota Astra Motor (TAM) believes that the government's policy is not yet fully inclusive or significantly increasing sales.

Photo : KatadataOTO

“Who are the buyers of Battery Electric Vehicles (BEV) now? The research we conducted shows they are mostly additional buyers,” said Resha Kusuma Atmaja, Marketing Planning General Manager of PT TAM, on the sidelines of GIIAS 2025 some time ago.

An additional buyer means someone who already owns a car. This means consumers with sufficient or upper-middle financial capabilities.

According to Toyota, LCGC is still the right way to boost car sales figures in the country.

LCGC targets first-time buyers or people who previously used two-wheeled vehicles to switch to cars.

In terms of maintenance, it is considered easy and cheap, and consumers do not need to worry about infrastructure.

So, there needs to be a government policy that pays attention to the first-time buyer consumer segment if it wants to boost car sales.

“Regarding a balanced and inclusive policy, in the end, we are confident it will develop the Indonesian market,” Resha affirmed.

He further explained that LCGC involves many related parties. Moreover, the units are locally assembled with a high TKDN, thus involving many industries, including Micro, Small, and Medium Enterprises (MSMEs).

Photo : Toyota

Amidst automotive challenges, weakening purchasing power, and widespread layoffs (PHK), LCGC is considered one of the right solutions.

LCGC is also still affordable for the middle class, which can help improve the automotive market more significantly.

“The end goal is for the public to inclusively and evenly receive the government's policies. So that we can jointly grow the market in Indonesia,” Resha affirmed.