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Chinese EV makers may relocate plants to Indonesia
Two electric car manufacturers from China are reportedly seeking to relocate their factories to Indonesia in response to the trade war between the country and the United States, an official from the Office of the Coordinating Maritime Affairs Minister has said
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span>Two electric car manufacturers from China are reportedly seeking to relocate their factories to Indonesia in response to the trade war between the country and the United States, an official from the Office of the Coordinating Maritime Affairs Minister has said.
A ministry undersecretary for infrastructure affairs, Ridwan Djamaluddin, said on Wednesday, the carmakers — BYD and JAC — had expressed interest to relocate to avoid high tariffs for entering the US market.
The representatives of the two companies had met several times with government officials, Ridwan said, adding that BYD had even started to talk to local partners for a project in Indonesia.
However, the Chinese investors had not revealed the value of the investment. “They have not revealed the figures, but they expressed their interest,” Ridwan said as quoted by tempo.co.
He said the government had also offered alternative locations for the electric car factories, mostly in West Java, but the investors might prefer other places that were closer to battery factories.
Ridwan said the investors also asked about the investment regulations in Indonesia, including the one on electric cars that would be released by the government. The draft of the regulation had been prepared since May 2018.
About the delay, Coordinating Maritime Affairs Minister Luhut Pandjaitan said that there was still going to be a revision to the presidential regulation draft.
“After my return from a foreign trip, we saw that there were articles [in the regulation] that should be discussed further,” he said, adding the revision was needed to ensure that it would not deter investors from putting their money in Indonesia.
Industry players and experts have urged the government to ensure adequate infrastructure for electric vehicles (EV), including battery charging stations, before implementing a planned regulation that will speed up incentives for production.
While the government has vowed to provide fiscal incentives for EVs, it should also prepare crucial infrastructure to support them, said Jongkie Sugiarto, cochairman of the Association of Indonesian Automotive Manufacturers (Gaikindo).
“Besides [fiscal] incentives, charging stations must also be allocated immediately,” he told The Jakarta Post recently.
The government has promised to to issue a presidential regulation (Perpres) to incentivize the use EVs by lowering the rate of luxury goods tax (PPnBM) and exempting them from import duties.
The incentives are part of an effort to reach the goal of having 2.1 million electric motorcycles and 2,200 hybrid or electric cars on the road by 2025 as mandated in Perpres No. 22/2017 on the national public energy plan.
