Ministry of Industry: By 2026, CBU Electric Vehicles Must Begin Local Production

KatadataOTO – Currently, there are still many electric car manufacturers marketing Completely Built Up (CBU) products in Indonesia. They then enjoy incentives from the government.

However, this assistance is not given without conditions. There are commitments that Electric Vehicle (EV) manufacturers must fulfill.

Based on the Minister of Investment Regulation Number 6 of 2023 jo Number 1 of 2024, BYD to VinFast are required to pay a bank guarantee for the amount of deferred import duties and Luxury Goods Sales Tax (PPnBM).

They must then commit to investing by establishing a factory in the country to produce electric cars locally.

Photo : KatadataOTO

"The import deadline is December 31, 2025. Starting from January 2026 until December 2027, companies must begin a 1:1 production commitment," said Mahardi Tunggul Wicaksono, Director of Maritime Industry, Transportation Equipment, and Defense Equipment (ILMATAP) of the Ministry of Industry (Kemenperin) in Jakarta, on Monday (25/08).

Furthermore, Tunggul explained that manufacturers are not only required to produce electric cars locally next year.

But they must also market the same number of electric four-wheeled vehicles that they sell in the country.

"They must pay attention to the Local Component Level (TKDN) of 40 percent, which must gradually increase to 60 percent," Tunggul continued.

He also revealed that to date, six companies have participated in the CBU electric car incentive program.

From this number, the government has successfully gathered significant additional investment, reaching around Rp 15 trillion.

As a reminder, some time ago Gaikindo also expressed a similar sentiment to the Ministry of Industry.