The Secretary-General of the Indonesian Automotive Manufacturers Association (GAIKINDO), believes that Indonesia has the potential to become a global supplier of electric vehicle (EV) components in less than 20 years. This opportunity is wide open, but Indonesia needs to focus on developing the upstream ecosystem of the domestic industry, including the supply of EV raw materials. Indonesia is still dependent on imports of materials such as steel, battery raw materials, and others. This ecosystem needs to be developed first to ensure our opportunity to become a global supply chain for electric vehicles. This consideration is essential because Indonesia is currently in fierce competition with Thailand in the field of motor vehicle production and marketing in the ASEAN region. GAIKINDO recorded that Indonesia produced 794 thousand motor vehicles in September 2021, while Thailand produced 1.2 million motor vehicles during the same period.
In principle, Indonesia has a significant opportunity, not only as a supplier of components but also as a producer of electric vehicles themselves. This is because iron ore and nickel, which are essential components for making electric cars, are abundant in Indonesia's natural resources. Therefore, this opportunity should be carefully considered, especially since the government has issued various regulations to accelerate the adoption of battery-based electric vehicles as these EVs are not new. Indonesia has been the largest market for Low-Cost Green Car (LCGC) sales in Asia. Since 2013, exports have continued to rise, exceeding 1 million units, and it ranks 11th globally in four-wheel vehicle production.
