Indonesia emerges as key player in ASEAN’s automotive market

Jakarta, The Gulf Observer: Indonesia has become a key player in the region’s automotive market and one of the busy automotive hubs in the ASEAN, Industry Minister Agus Gumiwang Kartasasmita stated.

“With sustainable infrastructure development, technological breakthroughs, innovations, the growth of the middle class, and the increasing demand for cars, Indonesia has become a busy automotive hub in Southeast Asia,” Kartasasmita noted in his statement received here on Tuesday.

At the Gaikindo Indonesia International Auto Show (GIIAS) 2023 Power Dinner held here on Monday (August 7) evening, the minister stated that the automotive industry has contributed significantly to the national economy

Indonesia has 21 four-wheeled motor vehicle industry companies, with a total production capacity of 2.35 million units per year, he remarked.

The automotive industry has also absorbed 38 thousand people into the workforce, with more than 1.5 million individuals working in the automotive supply chain from tier-1 to tier-3.

“In fact, this sector is able to provide significant foreign exchange through its export achievements. In addition, the industry’s rapid expansion has paved the way for major investments, resulting in a strong ecosystem of manufacturers, suppliers, dealers, and service providers,” he explained.

Kartasasmita reaffirmed the ministry’s commitment to continue to spur the industrial sector by investing in research and development (R&D), encouraging inclusive growth, and promoting environmental sustainability.

“We actively encourage the public and private sectors to collaborate to make the Indonesian automotive industry have the most innovation, efficiency, and competitiveness,” he stated.

In the second quarter of 2023, the automotive industry grew 9.66 percent, higher than the performance of the non-oil and gas processing industry that grew 4.56 percent year-on-year (yoy).

The government is also striving to develop electric vehicles. The Industry Ministry is optimistic that the sales of electric vehicles in Indonesia would increase dramatically.

In 2022 alone, at least 10 thousand electric vehicles were sold.