About Electric Vehicle Incentives, Observers: It Is Better For Industry With Certain TKDN

Illustration. (Photo: Doc. Antara)

JAKARTA - IESR Executive Director Fabby Tumiwa paid attention to several things related to the development of electric vehicles in Indonesia. One of them is the development of the industry.

"When we talk about electric vehicles, the technology is quite a lot but is the industry already growing? Be it the motorcycle battery industry, or the conversion system of electric vehicles," he said at the Energy Corner, Monday, December 19.

According to him, if the government wants to provide incentives or subsidies to electric vehicles, the government should direct the subsidy to grow the electric vehicle industry so that it can grow supply chains in the country.

"This is what I think is not discussed so far. When this discourse was made by Luhut, we only saw the amount, then the Minister of Industry also stated a subsidy for electric cars, but this should be a package," he explained.

He gave an example, if you want to provide subsidies for electric motors, the government should provide subsidies to vehicles that have a domestic component level (TKDN) as stated in the Minister of Industry Regulation Number 6 of 2022.

"For example, we only provide subsidies for electric motorcycles if they are produced in Indonesia and meet high TKDN, for example. How many TKDN must be calculated according to the industry's capabilities," added Fabby.

In addition, the government should also determine which recipients of the electric vehicle subsidy. He assessed that motorcycles are indeed a mode of transportation for the general public so that they should be prioritized. Meanwhile, the provision of subsidies for electric cars is considered inappropriate because those who are able to buy cars are middle to upper class people.

"For electric cars, it is not right because those who buy cars are economically advanced. I see this as a priority that must be considered and is part of the design of providing incentives for electric vehicles," he continued.

Previously, it was reported that the Minister of Industry Agus Gumiwang Kartasasmita said the government would provide incentives of Rp. 80 million for the purchase of electric cars and Rp. 40 million for the purchase of hybrid-based electric cars.

Meanwhile, incentives for the purchase of electric motorcycles are set at Rp. 8 million, and incentives for conversion motors to electric motorcycles are Rp. 5 million.