Indonesia accelerates electric and hybrid vehicle industry transition

The Indonesian government is implementing several strategies to accelerate the transition to electric and hybrid vehicles. Vice Minister of Industry Faisol Riza announced that starting in 2027, the government will prioritize the use of electric motorcycles for couriers, online motorcycle taxi drivers, corporate fleets, and government vehicles, with a goal to expand usage to all provinces by 2031–2035.

To support this transition, Minister of Industry Muhammad Sarmuji is reviewing new incentives for hybrid, plug-in hybrid (PHEV), and range-extended electric vehicles (REEV). These proposed measures include non-fiscal benefits such as administrative ease, exemption from odd-even traffic rules, and dedicated parking facilities, alongside potential tax relief. The government aims to finalize these proposals within the year to bolster the domestic automotive market and reduce subsidized fuel consumption.

In the academic sector, Vice Minister of Higher Education, Science, and Technology Stella Christie emphasized that universities must lead innovation in electric vehicle technology—specifically in battery performance and cost reduction—to ensure Indonesia becomes a technology leader rather than just a consumer market. Meanwhile, industry data shows significant growth, with BYD reporting 46,700 electric vehicle sales in Indonesia through September 2026, contributing to a national EV market share that has risen above 26 percent.