Sales of Imported Electric Cars Could Drop Drastically Without Incentives

KatadataOTO – A number of imported electric car products that meet the requirements are entitled to receive incentives from the government. So they can be sold at competitive prices.

This tax subsidy is now enjoyed by several brands, namely BYD, GAC Aion, Geely, and Citroen.

Incentives have indeed proven to be an attraction for consumers. BYD, as a newcomer, was able to record satisfactory sales throughout 2025 thanks to this assistance.

However, by 2026, BYD must start local assembly and have a minimum of 40 percent Local Content Level (TKDN).

Photo : Special

Unfortunately, to date, BYD is said to have not yet reached an agreement with local automotive component suppliers. 

Analysts assess that if next year the incentive recipients for imported electric cars do not meet the requirements, then all those products could be subject to full import duties and taxes.

“So the on-the-road price will soar. In Indonesia, the majority of sales volume is below IDR 500 million and is very price-sensitive,” said Josua Pardede, Chief Economist of Permata Bank to KatadataOTO recently.

For example, one of BYD's best-selling products is the Multi-Purpose Vehicle (MPV) M6, sold for around IDR 300 million to IDR 400 million.

The majority of Chinese electric cars use LFP batteries, which are claimed to be one of the keys behind their competitive prices. Because their price is cheaper compared to lithium-ion material batteries.

The loss of incentives could make people reluctant to buy because the price would be out of reach, not as competitive as when they still received tax cuts.

“This could potentially trigger a substitution back to Hybrid Electric Vehicles (HEV/hybrid cars) or Internal Combustion Engine (ICE/gasoline cars),” he continued.

He highlighted that without a transition, electric car sales, which are currently showing a positive trend, could drop sharply next year if the relevant brands have not yet started local assembly.

For your information, in the January-July 2025 period, electric car wholesales (distribution from factory to dealer) reached 42,178 units.

In comparison, that figure is nearly approaching the total wholesales of electric cars from January-December 2024, which was 43,188 units.

Photo : KatadataOTO

BYD still occupies the first position. As of July 2025, its wholesales were 16,427 units, covering various models including the Seal, Dolphin, Atto 3, and M6, while Denza had 6,256 units.

Without incentives, a rough calculation shows that the on-the-road price of imported electric cars could increase by hundreds of millions.

For example, the BYD Atto 1 is offered from IDR 195 million upwards. If a 50 percent import duty is imposed, the price of the Atto 1 could reach IDR 367.5 million.