EV players said suspending the incentive has put the brakes on sales. — The Jakarta Post
JAKARTA: Electric-vehicle (EV) industry players are urging the government to reinstate subsidies for electric two-wheelers, warning that suspending the incentive has put the brakes on sales.
While consumer interest in switching to electric motorbikes remains strong, many prospective buyers are holding back on purchases, awaiting clarity regarding government incentives, according to the Indonesian Electric Vehicle Industry Association (Periklindo).
“Fiscal policy is critical to move the market. The industry hopes the government will reinstate two-wheeler subsidies, whether under the previous scheme or a new one,” Periklindo chairman Moeldoko told reporters at the opening of the 2025 Periklindo Electric Vehicle Show held at JIExpo Kemayoran in Jakarta on Tuesday.
Under the previous subsidy scheme, which ended at end of last year, buyers were eligible for a seven million rupiah or about US$429 subsidy to purchase new electric motorcycles, as well as a 10 million rupiah subsidy to convert gasoline-powered bikes into electric ones.
“But if the government wants to roll out a better scheme, say through a tax reduction, we’re open to that,” he added.
The government earmarked 350 billion rupiah in subsidy spending in the state budget to support purchases of 50,000 new electric motorbikes last year, much lower than the 1.4 trillion rupiah subsidy allocation in 2023.
Because of high demand, the subsidy quota was increased by 10,857 units last August, bringing the total to 60,857.
A plan to review the subsidy programme for a possible extension has been shelved as the government awaits clarity on the impact of US trade policies
“Yes, it’s on hold. The US tariff policy has pushed us to put the plan on hold for now,” Deputy Industry Minister Faisol Riza said on Monday.
The government still intends to relaunch the subsidy this year, he noted, but the policy was under review for now.
The legal basis for the subsidy issued under Industry Ministry Regulation No. 21/2023, expired in December.
The Indonesian Electric Motorcycle Industry Association (Aismoli) previously announced that sales in the first quarter of this year had reached only 20% to 30% of last year’s first-quarter volume.
The group blamed the slowdown on the stalled incentives, but projected sales could climb to 200,000 units this year, triple the figure last year, provided the subsidy was reinstated.
“Sales are crawling because government support is still uncertain,” said Aismoli chair Budi Setiyadi on April 22.
Indonesia aims to have more than 15 million EVs on streets nationwide by the end of 2030. — The Jakarta Post/ANN
