According to Reuters, in order to attract more investment, the Indonesian government will provide tax incentives for some automakers to import complete electric vehicles before 2025.

Under the new regulations, companies that build electric vehicle factories in Indonesia, plan to increase investment in electric vehicles, or plan related investments will be eligible for tax incentives.

Indonesia’s previous tax incentives only targeted CKD components of imported cars, but the new regulations will cover taxes on imported complete vehicles, including temporarily canceling their import taxes and luxury goods sales taxes, and providing preferential measures to taxes levied by provincial governments.

Indonesia holds 22% of the world's nickel reserves and is the world's largest producer of nickel, a key raw material for medium- and long-range batteries for electric vehicles. The Indonesian government hopes to use this resource advantage to build Indonesia into an important part of the global supply chain of the electric vehicle industry and promote the development of domestic manufacturers in Indonesia. It has also proposed the goal of building an electric vehicle manufacturing and export hub in Southeast Asia and strives to achieve it by 2035. Increase electric vehicle production to 1 million units.

In order to achieve this goal, Indonesia has launched a series of preferential policies for electric vehicles and has relaxed localization requirements, delaying the deadline for companies to produce electric vehicles in Indonesia to be at least 40% localized from 2023 to 2026. Year.

In recent years, more and more Chinese companies have entered the Indonesian market.

In July this year, Nezha Auto also signed a memorandum of cooperation with its Indonesian partner. The two parties plan to start localized production from the second quarter of 2024. Battery manufacturers such as CATL are also cooperating with Indonesian companies.

BYD also regards Indonesia as an important stop for overseas expansion. In the middle of this year, BYD signed a memorandum of understanding with the Indonesian government to explore investment potential between China and Indonesia, including in the field of electric vehicles. Blue Bird, Indonesia's largest taxi operator, also announced that it plans to purchase 80% of its electric vehicles from BYD and re-evaluate Tesla orders because BYD's vehicles are more cost-effective.

According to data from the Passenger Car Association, 89,000 domestic new energy passenger vehicles were exported in November, of which 30,629 were BYD, accounting for 1/3. According to the latest report from market research organization Canalys, China's automobile exports will reach 5.4 million units in 2023, of which new energy vehicles will account for 40%, reaching 2.2 million units. As the Indonesian market further opens up, this may become an important growth point in the future.