How China took the lead in Indonesia’s EV race

Chinese manufacturers are steadily taking over Indonesia’s electric vehicle industry. They have even outpaced Japanese manufacturers, long the dominant force in the country’s automotive market.

Out of 19 EV players in Indonesia, seven are from China: Dongfeng Sokon Automobile (DFSK), Chery, BYD, Wuling, Neta, MG Motor, and Seres, according to Tech in Asia data as of June 12. In contrast, only four Japanese EV manufacturers – Mitsubishi, Toyota, Lexus, and Nissan – have entered Indonesia.

EV sales from Chinese brands have also been consistently growing in Indonesia, according to the Association of Indonesian Automotive Industries (Gaikindo).

While only two EV units from DFSK were sold in 2021, the overall sales from all Chinese brands have skyrocketed to thousands of units annually from 2022 onward. Most of these sales come from Wuling, which launched its first EV in Indonesia in August 2022.

Between January and April this year, Chinese EV makers sold 6,283 units in Indonesia. This surpassed the sales from British EV manufacturers by over 8x in the same period.

Meanwhile, Japanese EV firms only sold a total of 12 units during this time. This figure represents just 0.15% of the total EV sales in Indonesia for the period, which amounted to 7,747 units.

So how did EV manufacturers from China come to dominate the Indonesian market?

Easy on the pockets

One of the reasons for the Chinese EV makers’ lead is the significantly lower prices of their vehicles compared to those from other countries, says Andry Satrio Nugroho, head of the center of industry, trade, and investment at the Institute for Development of Economics and Finance.

Several Chinese vehicles are priced below 200 million rupiah (US$12,300). For example, the Wuling Air EV Lite is priced at 190 million rupiah (US$11,680), which is the same price as the Seres E1.

In comparison, Japan’s Toyota sells its bZ4X for 1.2 billion rupiah (US$73,774), Nissan prices its Leaf at 738 million rupiah (US$45,370), and Mitsubishi offers its L100 for 320 million rupiah (US$19,673).

Geopolitical factors

Japan chooses the hybrid road