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Indonesia is becoming an increasingly important market for many electric vehicle manufacturers as the country asserts itself as the world’s largest nickel producer – a key component in electric vehicle batteries. With a population of over 270 million, the fourth most populous country in the world is attracting the global automotive industry with an appealing market for both two-wheelers and four-wheelers.
At the ongoing Indonesia International Auto Show, VinFast has introduced two 5-seater rear-wheel-drive models, the VFe34 with a price of around 300 million rupiah (USD 19,000) and the VF5 with a price of 250 million rupiah.
According to Nikkei, this price is less than half of the global average price for an electric vehicle. But it is still expensive in Indonesia, where the average monthly salary is about 3.18 million rupiah as of August, according to the National Statistics Agency.
VinFast Asia Sales Director Zachary Mark Hollis shared with Nikkei Asia on Monday: “Indonesia is the largest automobile market in Southeast Asia. I believe that the domestic electric vehicle market will increase to 50,000 units this year and may reach 100,000 units next year. We want to capture a significant portion of the electric vehicle market in Indonesia.”
VinFast also plans to build a factory in Indonesia capable of assembling 50,000 electric vehicles per year. Hollis added that young people who own cars to commute between provinces will be the company’s target customers in Indonesia.
VinFast sees similarities between the domestic market and Indonesia. Both countries have a young population, a growing middle class, and a new generation of environmentally conscious consumers.
Visiting the auto show, Saskia Halima is browsing VinFast’s booth to find an electric vehicle as a second means of transportation. Halima said: “I am not only interested in VinFast but also in electric vehicles from other brands. Electric vehicles have the advantage of not needing to buy fuel, easier maintenance, and are suitable for the latest trends.”
For BYD, a representative of the Chinese brand said to Nikkei that the company imports vehicles from China but plans to produce them in Indonesia. The representative did not specify a specific timeframe for this.
BYD began selling electric vehicles in Indonesia in January and their buses have been used by the TransJakarta public network for the past two years.
The company’s latest passenger vehicle model – Atto 3, with a price of around 515 million rupiah – will be present at the auto show in Indonesia. This is the first time a leading Chinese electric vehicle manufacturer has exhibited at the auto show since entering the passenger vehicle market.
BYD and Hyundai Motor from South Korea occupy the largest booths at the show, according to the exhibition’s floor plan.
A Hyundai sales representative requested anonymity, saying that the automaker is ready to launch a new model at a more reasonable price when BYD arrived in Indonesia.
The South Korean company has revealed that the new version of the Kona Electric will be available in Indonesia at the end of next month. This model will start at a price of 500 million rupiah, much lower than the premium Ioniq 5 model with a starting price of 754 million rupiah.
The Hyundai sales representative said: “BYD offers cheaper models and we understand that Indonesian people are looking for affordable products but have good quality.” The representative said the company wants to study the market reaction to the new Kona Electric.
Toyota Motor of Japan, the leading overall automotive market player in Indonesia, will take this event to introduce its all-new Yaris Cross HEV. Toyota said the hybrid electric vehicle would have 80% of its components produced domestically, and this would be the company’s first-ever clean vehicle exported from Indonesia.
According to Nikkei Asia
