Electric Vehicle Price War Heats Up, Gaikindo Issues This Warning

KatadataOTO – Price wars are still a mainstay for a number of car manufacturers in Indonesia. This is considered effective for attracting a large number of consumers to boost sales.

This practice is usually carried out by electric car manufacturers. For example, the BYD Atto 1 is marketed at around Rp 195 million.

Then some time ago, Chery also slashed the prices of their products. For instance, the new versions of the Omoda 5 and E5 are sold for Rp 50 million to Rp 100 million cheaper.

Seeing this, the Association of Indonesia Automotive Industries (Gaikindo) has spoken out. According to them, this situation needs to be carefully observed.

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Moreover, manufacturers marketing vehicles as Completely Built Up (CBU) and utilizing electric car incentives have an obligation, which is to invest or build a factory in Indonesia.

“So even though there's a price war now, there will be a limit until the end of this year for those using CBU. There is a bank guarantee, so that policy will end and they will then be required to assemble here,” said Kukuh Kumara, General Secretary of Gaikindo, on the sidelines of GIIAS 2025 some time ago.

He explained that the government is indeed providing a temporary window for Chery, BYD, and Jaecoo to import vehicles completely built-up.

However, this scheme is not without conditions. Every unit that enters the country must be balanced with local production in a similar quantity.

“So if they bring in a thousand (cars), they must produce a thousand. If not, for example, they only make 500, then the guarantee money for the remaining 500 is disbursed to the state,” continued Kukuh.

The local production in question is not for export purposes. Instead, it must be sold domestically.

According to Kukuh, this policy is intended to ensure that manufacturers continue to invest in Indonesia. Additionally, they should not rely solely on imports.