Pinwan, October 10, according to Zhitong Finance, Indonesia plans to start subsidizing the purchase of electric vehicles from next year. Indonesia hopes to have 2.5 million electric vehicle users by 2025, boosting demand and reducing air pollution.
Indonesian Transport Minister Budi Karya Sumadi said in an interview last Thursday that the government was deciding on the size and precise mechanism of subsidies, promising that the new rules would be a “game changer” for the domestic vehicle industry.
“I was asked why Indonesia is so ambitious with electric vehicles. Probably because he has not experienced the air pollution from combustion engines that we experience here,” he said. According to the IQAir index, Indonesia is the most polluted in the world. 17th among countries (the index scores 117 countries for air quality).
Budi Karya Sumadi said the regulator is also considering subsidies for the conversion of combustion engine vehicles. He said the government was looking at the plan carefully because it would bring about a major shift in the labor-intensive auto industry. He said the ministry would approach Indonesia’s existing carmakers, including Hyundai Motor and BYD Corp, to build an electric vehicle ecosystem for Indonesia’s new capital in Borneo, which plans to run entirely on renewable energy.
Earlier this year, the Indonesian government ordered all state government offices to switch to electric vehicles and asked PLN to increase charging stations in order to reach 2 million electric motorcycle users and electric vehicle users in less than 4 years reach the target of 500,000. Budi Karya Sumadi expects the public transport sector to be fully electrified within 5 years.
According to the Ministry of Transport, Indonesia had about 28,188 electric vehicles as of October 3, of which 22,942 were motorcycles and 4,904 were cars. The rest are buses, trucks and tricycles. Budi Karya Sumadi said electric motorcycles are likely to lead the way in terms of growth as they reach price equilibrium with combustion engine vehicles faster than electric vehicles.
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