The Ministry of Industry states that the assumption of the automotive sector being strong is incorrect.

KatadataOTO – The Ministry of Industry revealed that the assumption by some that the automotive industry is in a strong condition is wrong. This is because overall vehicle sales data shows the opposite.

Febri Hendri Antoni Arif, spokesperson for the Ministry of Industry, revealed that EV sales have indeed increased significantly. However, in the period from October 2024 to January 2025, sales were mostly supported by CBU EV imports.

In fact, of the total EV sales from January to October 2025, 73 percent were imports. Thus, the added value and labor absorption of the industry are in other countries.

Meanwhile, the domestically produced vehicle segment, which has the largest market share, has experienced a significant decline. Therefore, according to him, it is wrong to state that the automotive industry is in a strong condition by only relying on growth indicators in certain segments.

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"The sharp decline in car sales, far below production figures, while imported EV sales are rising sharply is a fact. This must be an indicator of the national automotive industry's growth, and we believe incentives are needed to reverse this situation," he stressed, as reported by Antara.

He also assessed that the large number of exhibitions does not mean the automotive industry is strong. The strength of the national automotive industry can only be concluded based on sales and production data.

"Many exhibitions are an effort by the industry to survive amidst plummeting sales. We must use existing statistical data to describe the objective condition of the automotive industry and not use the number of automotive events," Febri added.

The Ministry of Industry emphasizes that the most fundamental indicator for measuring the health of the automotive industry is vehicle sales to the market, not just the growth of certain segments or the size of investments.

Based on Gaikindo data, car wholesales from January-October 2025 were only 634,844 units. That figure is down 10.6 percent compared to last year, which reached 711,064 units.

Meanwhile, retail sales (sales from dealers to consumers) were recorded at 660,659 units from January-October 2025. That figure is down 9.6 percent from last year, which reached 731,113 units.

Photo: Special

Therefore, the Ministry of Industry asserts that automotive incentives are a crucial instrument in efforts to recover the market.

"Although the Ministry of Industry has not yet formulated the type, form, and target of the incentives, the proposal will be directed towards the lower-middle class segment and based on the TKDN (Domestic Component Level) value," he said