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View all search resultsGovt plans new EV incentives even as sales soar
Electric vehicle adoption is accelerating and overall car sales have begun to recover in the first half of the year.
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Industry Minister Agus Gumiwang Kartasasmita (right) accompanied by PT Toyota Motor Manufacturing Indonesia president director Nandi Julyanto (second right) and PT Toyota-Astra Motor vice president director Jap Ernando Demily, (third right) looks at a Toyota vehicle fueled with B50 biodiesel after opening the Gaikindo Indonesia International Auto Show (GIIAS) 2026 at the Indonesia Convention Exhibition (ICE) in BSD, Tangerang, Banten, on July 30, 2026. (Antara/Muhammad Iqbal)
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ndonesia's automotive market is showing signs of recovery with vehicle sales rebounding and electric vehicle (EV) adoption accelerating, and the government hopes to sustain that momentum with a new round of EV incentives.
Data from the Indonesian Automotive Manufacturers Association (Gaikindo) show wholesale vehicle sales rose 15.9 percent year-on-year to 436,564 units in the first half of 2026, with electrified vehicles accounting for 26.8 percent of national passenger vehicle sales, up from 18.3 percent a year earlier.
Sales of electrified vehicles, which includes battery electric vehicles (BEV) as well as hybrid and plug-in hybrid vehicles, jumped 69.4 percent year-on-year to around 117,000 units in the first half, with BEVs accounting for roughly 69,000 units.
Despite the encouraging performance, Purbaya said the industry had yet to realize its full potential after years of subdued economic growth weakened household spending power.
Although Indonesia’s population is more than seven times as large as Malaysia's, annual vehicle sales are similar in both countries.
Purbaya argued that slower economic growth over the past decade had constrained household incomes, limiting consumers' ability to purchase new vehicles.
He said stronger economic growth and an improved business climate would eventually translate into higher spending power and stronger domestic demand.
