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China’s BYD, Neta eye growth in Indonesia with new EV investments

Chinese electric vehicle makers BYD and Neta Auto are poised to challenge Japan’s dominance in Indonesia’s car market, announcing new investment plans and rolling out their latest models at an auto show in Jakarta.

Indonesian property developer Suryacipta Swadaya announced on April 30 that BYD will build a USD 1 billion factory on 1.08 square kilometers of land in West Java. Construction is slated to start in August, and operations are expected to commence in January 2026. The plant’s capacity will be announced later, the company said.

“We are confident that the facilities to be built will be able to drive the growth of Indonesia’s automotive industry and transition towards clean energy while also supporting the economy, especially in the surrounding region,” Eagle Zhao, president director of BYD Motor Indonesia, said in a statement.

Southeast Asia’s largest auto market, Indonesia sold about 1 million new cars in 2023. Japanese brands such as Toyota and Mitsubishi control more than 90% of the market, but Chinese automakers are now moving in with EVs.

“This year, Neta Indonesia is committed to increasing our investment in Indonesia by initiating local production,” Jerry Huang, Neta’s managing director, said on April 30, during a press conference at the auto show.

In November, the company signed an agreement with Handal Indonesia Motor to assemble EVs in Indonesia. It is scheduled to start operations in the second quarter of this year.

More than 80 brands, including motorcycle makers and parts businesses, are participating in the Periklindo Electric Vehicle Show, which opened on April 30 and runs through May 5. Periklindo, or the Indonesian Electric Vehicle Industry Association, held its first EV exhibition in 2022. This year, the venue’s floor size more than doubled from last year.

In making its debut at the Jakarta EV show, BYD showed off its Dolphin model, deliveries of which are expected to begin in July. Dolphins will be imported from China. A Dolphin will be priced at around IDR 425 million (USD 26,115), half the global average for an EV but far out of reach for most consumers in a nation where the average monthly wage was about IDR 3.18 million (USD 200) as of August, according to the Central Statistics Agency.

Neta, another Jakarta EV show newbie, unveiled the Neta V-II, which will be priced from IDR 200–300 million (USD 12,290–18,430), making it the least expensive car in the company’s Indonesia lineup.

“Neta V-II was born as the beginning of our commitment to the Indonesian market and became the first Neta product to be assembled locally,” Huang, the managing director, told reporters.

In the US and other markets, EV demand is slowing, with fierce competition leading to price wars in countries like China and Thailand ↗.

However, the BYD sales representative at the show expressed optimism for the Indonesian market, saying demand is growing “driven by young consumers and families.”

He added that the company is confident Indonesia’s EV market will continue to grow and mentioned a government incentive program is helping to improve demand for EVs.

Herman Tri Putra of Neta said, “I think Indonesia’s situation is different from the US and Europe because we already have battery materials such as nickel, and the government fully supports the developing EV industry.”

Indonesian President Joko “Jokowi” Widodo’s government is leveraging Indonesia’s nickel resources ↗ in an effort to draw investments from electric battery and vehicle producers, make the country an indispensable part of the global supply chain and foster homegrown manufacturers. Incoming president Prabowo Subianto ↗ is expected to follow Jokowi’s EV policies.

Apart from the latest investment pledges by the two Chinese companies, South Korea’s Hyundai Motor began full-scale production at an Indonesian factory in March 2022. In August 2022, China’s Wuling Motors began operating an assembly line for its Air EV model in Cikarang, West Java.

Japanese carmakers, meanwhile, are staying the course on hybrid vehicles rather than immediately shifting to fully electric cars.

Indonesia’s sales of battery electric cars jumped nearly 70% last year to 17,051 vehicles from 10,327 in 2022, according to wholesale data by the Association of Indonesia Automotive Industries. Indonesia’s hybrid car market is also expanding, with sales volume increasing 5.2 times to approximately 54,000 units in 2023.

This article first appeared on Nikkei Asia ↗. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei ↗.

Kaylie Pferten
Kaylie Pferten
A pilot of submersible crafts in a former life, now married to my husband David and writing about investment advice.

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