October 14, 2025 | 04:16 pm
TEMPO.CO, Jakarta - Indonesian Minister of Industry, Agus Gumiwang Kartasasmita, announced a new investment commitment of US$316.28 million (Rp5.25 trillion) from Chinese automaker Chery to strengthen Indonesia’s battery-based automotive industry.
Agus described the move as a strategic step to accelerate the development of low-emission vehicles and expand the country’s automotive production base.
“This investment demonstrates Chery’s commitment to strengthening Indonesia’s automotive industry, particularly in low-emission and electric vehicles. The government will continue to support the acceleration of this investment realization,” Agus said in a written statement on Tuesday, October 14, 2025.
Agus praised Chery’s support of the government’s Low Carbon Emission Vehicle (LCEV) program. Chery has developed three types of vehicle technology: Full Hybrid, Plug-in Hybrid, and Electric Vehicle (EV).
Chery’s investment in Indonesia began in 2024 and will continue until 2030. The cumulative investment has surpassed Rp5.2 trillion, covering production facility development through partnerships as well as the construction of independent factories.
The minister urged Chery to finalize a five-year business plan, particularly regarding production capacity expansion and export strategies.
“We hope Indonesia can become Chery’s production and export hub for electric vehicles in the ASEAN region,” Agus, a Golkar Party politician, added.
The Ministry of Industry noted that electric vehicle sales in Indonesia have shown a steady upward trend over the past four years. The market share of battery electric vehicles (BEV) rose from 0.08 percent in 2021 to 10.22 percent by August 2025, with Chery currently ranking fourth in BEV sales in the country.
Previously, the government introduced a policy requiring automotive manufacturers receiving incentives for imported whole electric vehicles (CBU) to produce domestically from January 1, 2026, to December 31, 2027.
Production must meet a minimum Domestic Component Level (TKDN) of 40 percent, gradually increasing to 60 percent, according to Mahardi Tunggul Wicaksono, Director of Maritime Industry, Transportation Equipment, and Defense Equipment (IMATAP) at the Ministry of Industry.
Incentives for CBU electric vehicle imports, valid until December 31, 2025, include exemptions from import duties, reduced luxury goods sales tax, and VAT. Beneficiary companies are required to produce domestically at a 1:1 ratio to the number of CBU vehicles imported.
Currently, six companies benefit from BEV import incentives: PT National Assemblers (Citroen, AION, Maxus), PT BYD Auto Indonesia, PT Geely Motor Indonesia, PT VinFast Automobile Indonesia, PT Era Industri Otomotif (Xpeng), and PT Inchcape Indomobil Energi Baru (GWM Ora).
These companies have planned investments totaling Rp15.52 trillion, with a combined production capacity of up to 305,000 units, fulfilling commitments tied to the incentives.
The government is urging all beneficiary companies to promptly realize domestic production.
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Alfitria Nefi Pratiwi contributed to the writing of this article.
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