Indonesia and China Agree to Establish Indonesia as Export Production Hub

Jakarta, The Gulf Observer: Indonesia and four major Chinese electric vehicle (EV) companies—Neta, Wuling, Chery, and Sokon—have agreed to establish Indonesia as a production hub for environmentally friendly vehicles aimed at export markets. The agreement was reached during a working visit by Industry Minister Agus Gumiwang Kartasasmita to Beijing on June 12-13, 2024.

Minister Kartasasmita announced, “The companies have also agreed to make Indonesia a production base hub for right-hand drive EVs to be exported to 54 countries that use right-hand drive cars.” He further noted that the Indonesian government has set a production target of 600,000 electric vehicles by 2030.

During the visit, PT Neta Auto Manufacturing Indonesia, a subsidiary of Neta, revealed plans to increase the Domestic Component Level (TKDN) to 60 percent by 2025, with a sales target of 10,000 units per year. SAIC GM Wuling Automobile Company is expected to boost the export quantity of Indonesian-made electric cars, establishing Indonesia as a key production base for EVs in ASEAN and globally. The Indonesian government expressed hope that Wuling will further explore the export market for EV products.

Chery Automobile plans to research the production of plug-in hybrid electric vehicles (PHEVs) in Indonesia, responding to their popularity in China due to fuel economy. The company is committed to producing 100,000 EV units by 2030.

Additionally, Sokon, through its subsidiary SOKONINDO, is expected to support the development of the EV ecosystem in Indonesia by introducing various new EV models, leveraging their production capacity of up to 50,000 units.

Minister Kartasasmita highlighted that these Chinese manufacturing companies could benefit from the incentives provided by the Indonesian government to attract investment, underscoring the strategic importance of Indonesia as an EV production hub for the ASEAN region and beyond.