The Electric Vehicle (EV) competition in Indonesia continues to heat up with more and more companies materializing their investments in the market. 

The most recent announcement, as reported by Nikkei Asia on January 9, was the US$200 million (roughly Rp 3.1 trillion) investment plan from Vietnam-based Vinfast for a car assembly and battery production plant in Indonesia, to be built in conjunction with the company’s expansion to India. The amount is part of Vinfast’s estimated $1.2 billion long-term investment plan for Southeast Asia’s largest economy. 

As further elaborated by Katadata, Vinfast has secured a land in the Tamil Nadu region in India for a plant with a production capacity of 150,000 EVs annually. Detailed information regarding the Indonesian plant is yet to be disclosed however, with Indonesian Industry Minister Agus Gumiwang Kartasasmita quoted as saying that the government was still in discussion with the Vietnamese conglomerate. 

Based on available information, Vinfast will build its plant in Bekasi, West Java, starting in the first quarter of 2024. Reportedly, the 200-hectare facility will produce city car models and the Vinfast VF 5 crossover and Vinfast e34, priced between Rp 250 million and Rp 300 million. In the meantime, Indonesians can expect these models to be introduced officially at the 2024 Indonesia International Motor Show (IIMS) scheduled for February 2024.  

Vinfast’s foray into the Indonesian market further enlivens the country’s increasingly competitive EV market. Currently, the EV manufacturing scene, especially for models priced below Rp 500 million, has been predominantly led by Chinese companies, namely Wuling Indonesia; PT Sokonindo Mobile – which sells the Seres E1 model; and Neta EV. Korea-based Hyundai, which is selling its Ioniq EV car series in Indonesia and is also slated to produce the model locally, falls outside this category. Instead, it competes with the more established Japanese car companies such as Toyota and Honda, which has had traditionally dominated the domestic Internal Combustion Engine or ICE car market.  

Another recent announcement is China-based BYD’s reported plan to officially launch its EVs in Indonesia next week, which, purportedly, will include BYD’s Dolphin, Seal, and Atto 3 models. 

It may be noted that BYD has also expressed its long-term commitment to expanding its business expansion in Indonesia. The company is currently having ongoing negotiations with the Indonesian government to also build an EV assembly and battery production facility.  

BYD made headlines recently after it officially toppled US-based Tesla as the world’s best-selling EV maker for the first time ever. Based on the companies’ financial reports, Tesla handed over 484,000 EVs in the fourth quarter of 2023, more than the 473,000 anticipated by analysts, but still below 526,000 EVs delivered by BYD in the same period. 

Additionally, the Indonesian government has also been actively promoting the growth of the local EV industry, such as through the issuance Presidential Regulation No. 79/2023, which introduces various tax incentives for EV carmakers producing domestically.