The Deputy Director for Infrastructure and Regional Development Coordination predicts that car sales in Indonesia in 2025 will only reach 832,000 units, below the target of 900,000 units set by the Indonesian Automotive Industry Association. This figure is based on historical sales trends for four-wheeled vehicles and above over the first five months of the past two years, combined with seasonal industry factors. Despite the overall weak automotive market, electric vehicles are showing growth. It is projected that sales of Battery Electric Vehicles (BEV) will surge from 43,000 units in 2024 to 126,000 units in 2025, while Hybrid Electric Vehicles (HEV) will increase from 57,000 to 71,000 units, and sales of traditional internal combustion engine vehicles will continue to decline, from 766,000 units in 2024 to 634,000 units in 2025, with an average annual decline of about 11% between 2022 and 2025. The compound annual growth rates for BEV and HEV are 87% and 93%, respectively. The data reflects increased consumer acceptance of electric vehicles and a clear trend of shrinking market share for traditional fuel vehicles. The government continues subsidy policies for Value Added Tax (PPN) and Luxury Goods Sales Tax (PPnBM) on certain electric vehicles to stimulate demand. The Chairman of the Indonesian Automotive Industry Association remains optimistic about the 900,000-unit target, but acknowledges that slowing economic growth (2025 GDP growth of 4.87%, lower than the previous 5.1%-5.2% level) is a major challenge. 60% of car sales rely on leasing credit, making interest rate stability crucial; he calls on fiscal policy to avoid increasing the burden on consumers and to monitor market reactions following the implementation of the Consumption Tax (PPN 12%) in 2025. He pins hopes on events such as the 2025 Indonesia International Auto Show and Jakarta Auto Week to stimulate sales. Despite the overall weak automotive market, electric vehicles (BEV/HEV) have become a growth highlight, while the market share of traditional fuel vehicles continues to be squeezed.
The Deputy Director for Infrastructure and Regional Development Coordination predicts that car sales in Indonesia in 2025 will only reach 832,000 units, below the target of 900,000 units set by the Indonesian Automotive Industry Association. This figure is based on historical sales trends for four-wheeled vehicles and above over the first five months of the past two years, combined with seasonal industry factors. Despite the overall weak automotive market, electric vehicles are showing growth. It is projected that sales of Battery Electric Vehicles (BEV) will surge from 43,000 units in 2024 to 126,000 units in 2025, while Hybrid Electric Vehicles (HEV) will increase from 57,000 to 71,000 units, and sales of traditional internal combustion engine vehicles will continue to decline, from 766,000 units in 2024 to 634,000 units in 2025, with an average annual decline of about 11% between 2022 and 2025. The compound annual growth rates for BEV and HEV are 87% and 93%, respectively. The data reflects increased consumer acceptance of electric vehicles and a clear trend of shrinking market share for traditional fuel vehicles. The government continues subsidy policies for Value Added Tax (PPN) and Luxury Goods Sales Tax (PPnBM) on certain electric vehicles to stimulate demand. The Chairman of the Indonesian Automotive Industry Association remains optimistic about the 900,000-unit target, but acknowledges that slowing economic growth (2025 GDP growth of 4.87%, lower than the previous 5.1%-5.2% level) is a major challenge. 60% of car sales rely on leasing credit, making interest rate stability crucial; he calls on fiscal policy to avoid increasing the burden on consumers and to monitor market reactions following the implementation of the Consumption Tax (PPN 12%) in 2025. He pins hopes on events such as the 2025 Indonesia International Auto Show and Jakarta Auto Week to stimulate sales. Despite the overall weak automotive market, electric vehicles (BEV/HEV) have become a growth highlight, while the market share of traditional fuel vehicles continues to be squeezed.