Investment by Automotive Manufacturers in Indonesia Reached IDR 174 Trillion

KatadataOTO – The Ministry of Industry stated that the national automotive segment now plays an important role in the nation's economy. This is because the total investment disbursed by vehicle manufacturers has reached IDR 174.31 trillion and absorbed a direct workforce of 99,700 people.

That figure is an accumulation of the performance of the four-wheeled, three-wheeled, and two-wheeled motor vehicle (KBM) automotive industry. That number may even continue to grow, considering many foreign companies still want to enter the country.

In detail, there are at least 32 car manufacturers in Indonesia with a total capacity reaching 2.35 million units per year, absorbing up to 69,390 workers. The production volume in 2024 was also considerable, reaching 1.19 million units.

Of this total, 865,000 were used for domestic market needs. Meanwhile, another 472,000 units were sent to the export market in completely built-up (CBU) condition.

Photo : Wuling

“In the first three months of 2025, the production performance of car manufacturers was 288,000 units. Meanwhile, sales figures were 205,000 units, CBU exports were 110,000 units, and CBU imports were 11,000 units,” said Mahardi Tunggul Wicaksono, Director of Maritime Industry, Transportation Equipment, and Defense Equipment (IMATAP) of the Ministry of Industry.

Meanwhile, for the two- and three-wheeled vehicle industry, there are currently 73 manufacturers in operation. The total annual production reaches 10.72 million units, absorbing up to 30,310 workers.

Last year, the two-wheeled vehicle industry had a production performance of 6.91 million units. From that, sales performance was 6.33 million units and CBU exports were 572,000 units.

Meanwhile, in the first quarter of 2025, production performance was 1.81 million units, sales were 1.68 million units, and CBU exports were 134,000 units.

To attract more investment, the government is providing various facilities. One of them is the provision of a 0 percent import duty incentive and a 15 percent Luxury Goods Sales Tax (PPnBM) borne by the government (DTP).

Photo : Courtesy

Furthermore, a 10 percent incentive will be given to electric cars and buses that have a minimum Domestic Component Level (TKDN) of 40 percent. Meanwhile, electric buses with a TKDN of 20 percent to 40 percent will be given assistance of 5 percent.

In addition, industries that produce hybrid vehicles and then become participants in the Low Carbon Emission Vehicle (LCEV) program receive a PPnBM DTP incentive of 3 percent.