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EV industry urges govt to reinstate two-wheeler subsidies as market slows
A plan to review the subsidy program for a possible extension has been shelved as the government awaits clarity on the impact of US trade policies.
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Vehicles of Indonesian electric motorcycle brand Selis are pictured on Oct. 27, 2019, in Jakarta. (Shutterstock/Wulandari)
E
lectric vehicle industry players have urged the government to reinstate subsidies for electric two-wheelers, warning that suspending the incentive has put the brakes on sales.
While consumer interest in switching to electric motorbikes remains strong, many prospective buyers are holding back on purchases, awaiting clarity regarding government incentives, according to the Indonesian Electric Vehicle Industry Association (Periklindo).
“Fiscal policy is critical to move the market. The industry hopes the government will reinstate two-wheeler subsidies, whether under the previous scheme or a new one,” Periklindo chairman Moeldoko told reporters at the opening of the 2025 Periklindo Electric Vehicle Show (PEVS) held at JIExpo Kemayoran in Jakarta on Tuesday.
Read also: Govt mulls VAT waiver to replace electric motorbike subsidy
Under the previous subsidy scheme, which ended at the turn of the year, buyers were eligible for a Rp 7 million (US$429) subsidy to purchase new electric motorcycles, as well as a Rp 10 million subsidy to convert gasoline-powered bikes into electric ones.
“But if the government wants to roll out a better scheme, say through a VAT reduction, we’re open to that,” he added.
The government earmarked Rp 350 billion in subsidy spending in the state budget to support purchases of 50,000 new electric motorbikes in 2024, much lower than the Rp 1.4 trillion subsidy allocation in 2023.
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