30 January 2025
Press Release

Government Incentives as a Pathway for Indonesia to Become an Electrified Vehicle Production and Export Hub

The year 2024 was full of challenges for Indonesia’s automotive industry. In response, the government introduced various incentives to stimulate domestic sales and exports of locally manufactured vehicles. The aim is to strengthen Indonesia’s role as a global vehicle production hub and to establish the national automotive industry as an electrified vehicle ecosystem. Through the provision of incentives for hybrid vehicles—specifically, a 3% luxury goods sales tax (PPNBM) discount covered by the government for domestically produced hybrid cars—the national automotive industry is expected to maintain its positive contribution to both domestic and export markets, supporting a favorable trade balance.

According to GAIKINDO data, Toyota Indonesia recorded exports of 276,089 units of T-brand vehicles from January to December 2024. This figure represents a 5% decline compared to the 290,772 units exported in the same period in 2023. However, with strong support from the Indonesian government, society, stakeholders, and a robust automotive supply chain from upstream to downstream, Toyota Indonesia has consistently contributed around 61% of Indonesia’s total CBU exports over the past five years (2019–2024).

To date, Toyota Indonesia has exported vehicles to over 80 destination countries worldwide. In addition to exporting completely built-up (CBU) vehicles, Toyota Indonesia also exports completely knocked-down (CKD) vehicles, engines, components, and production support tools such as dies and jigs.

"Sustaining consistent export performance is not an easy feat, given the crucial role played by Indonesians across thousands of supply chains, including Small and Medium Enterprises (SMEs). In the face of global economic fluctuations, Toyota Indonesia remains committed to collaborating with the entire supply chain—from upstream to downstream—by exporting 10 variants of T-brand vehicles, including both ICE and electrified models. This effort will ensure Indonesia retains its position as a global production and export hub. We are committed to ensuring that Indonesian-made automotive products meet the demands of an increasingly competitive global market," said Nandi Julyanto, President Director of PT TMMIN.

Surging Demand for Domestically Produced Electrified Models

Despite an overall decline in national automotive export performance, demand for electrified models surged by more than 100% throughout 2024. Locally produced electrified vehicles contributed 18,553 units to national automotive exports—an increase of 111% compared to 8,792 units in the previous year. This achievement came from exports of the Kijang Innova Zenix (HEV) with 11,790 units and the Yaris Cross (HEV) with 6,763 units. Both models, manufactured at TMMIN Karawang Plant 1, are increasingly favored by global consumers across Asia, Africa, Latin America, and the Middle East.

"The growing demand for electrified vehicles reflects global consumers' awareness of climate change and environmental issues, underlining the principle that 'Carbon is our Enemy.' This means that the national automotive industry must lead the transformation towards an electrified vehicle ecosystem to meet international market demands for eco-friendly products, particularly as we enter the energy transition era. One key strategy is the multi-pathway approach, which accommodates diverse vehicle technology demands while ensuring sustainable growth for Indonesia’s automotive industry in the past, present, and future. True to our principle 'No One Left Behind,' no vehicle technology should be abandoned," said Bob Azam, Vice President Director of PT TMMIN.

Toyota Indonesia remains committed to developing electrified vehicles in support of Indonesia’s Net Zero Emissions (NZE) target by 2060. Through the multi-pathway strategy, Toyota Indonesia offers a wide range of vehicle technologies, including low-emission Internal Combustion Engine (ICE) vehicles, Hybrid Electric Vehicles (HEV), Plug-in Hybrid Electric Vehicles (PHEV), Battery Electric Vehicles (BEV), Fuel Cell Electric Vehicles (FCEV), and renewable fuel-based vehicles (such as biodiesel and bioethanol-powered Flexy Fuel vehicles).

"Beyond electrified vehicles, the Veloz and Fortuner models have also made significant contributions to TMMIN’s export performance, totaling 110,714 units over the past year. As a high-tech and labor-intensive industry, Toyota Indonesia continues to enhance the competitiveness of locally manufactured products by developing highly skilled local talent—a commitment we have upheld for over five decades and will continue into the future alongside the Indonesian people," added Nandi Julyanto.

Target Performance for the National Automotive Industry

Toyota Indonesia aims to maintain the same level of T-brand vehicle exports in 2025 as in the previous year. The company is actively exploring new opportunities to expand export activities, considering market demand trends and seeking new non-traditional export destinations to maximize Indonesia’s strategic demographic potential.

"Toyota Indonesia is not only focused on exporting fully built-up vehicles but is also developing converted vehicles, accessories, and derivatives in response to global market demands. This includes cash carrier vehicles, well-cab vehicles, and patrol cars, tailored to meet the specific needs of different countries. Our goal is to deliver competitive and innovative automotive products. We firmly believe that strong collaboration between the industry, government, and supply chain partners will enable Indonesia’s automotive industry to become highly competitive and sustainable, bringing real benefits to the nation’s economic growth," concluded Bob Azam.

Since 1971, Toyota Indonesia has been committed to growing alongside Indonesian society, continuously advancing mobility solutions through diverse vehicle technologies from the past to the present, and preparing for future energy innovations.

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