Indonesia Fans The Electric Vehicle Market Fire In Southeast Asia

The market is watching China, Thailand and Vietnam for electric vehicle (EV) market movements. Indonesia has declared its entry into the competition. It would not be long when the market welcomes an Indonesia EV.

It is a known fact China, Thailand and Vietnam are EV hotspots, albeit China is dominating the sector with several global investments and collaborations with automakers. The glaring irony is that the Americans have pumped in substantial resources to support China’s EV market. However, it makes perfect sense why China is a better bet now.

Indonesia Declares EV Entry

Indonesia’s President Joko Widodo (Jokowi) said that Indonesia has all components required to produce EVs. Hence, it has a huge opportunity to build an ecosystem for the EV industry in future. “We have nickel, copper, and also tin. All the components needed for electric cars are in Indonesia,” he said at the opening of the 2023 XVIII PP Muhammadiyah Youth Conference in Balikpapan, East Kalimantan.

Hence, Indonesia is keen on building a large EV ecosystem, Jokowi stressed. He added, “We must have good products that could make other countries depend on us. The raw materials are all in Indonesia, including that for EV batteries. The future of this ecosystem will become big in Indonesia.” Jokowi noted that a developed country can make other nations depend on the products it manufactures.

Indonesia’s potential in the EV market commands attention given the accumulated investment volumes, due to its rich nickel reserves. The country reportedly signed more than a dozen deals worth more than US$15 billion for battery materials and electric vehicle production with global manufacturers including Hyundai, LG and Foxconn. It may not be long when the market welcomes an Indonesia EV.

Other Markets

China is the world’s largest EV market, with sales expected to top 6 million units in 2022, doubling 2021’s 2.99 million cars. However, it is a cutthroat market, as Beijing’s drive to encourage the use of EVs has attracted some 200 companies, which have invested tens of billions of dollars in developing, designing and assembling electric cars. Member countries of the Association of Southeast Asian Nations (ASEAN) are target markets for Chinese EV companies whose cars range from RMB 100,000 (US$14,204) to RMB 200,000.

Statista.com’s findings revealed Thailand’s revenue in the EV market is projected to reach US$178.80m in 2023. The annual revenue growth rate is projected to be (CAGR 2023-2027) of 22.31 percent, resulting in a projected market volume of US$400.10 million by 2027. That translates to projected unit sales reaching 9,196.5 vehicles in 2027. The volume weighted average price of EV market in 2023 is expected to amount to US$44.76 k.

Vietnam’s EV market is dominated by its own VinFast. However, it will face competition on home ground when Chinese competitor BYD Auto Co builds a plant in Vietnam to produce car parts, Reuters learnt — in a move that would reduce the company’s reliance on China and deepen its supply chain in Southeast Asia as part of a global expansion. It would worth keeping our eyes open on the Southeast Asian EV market when regional big guns navigate the tricky mission of business expansion – especially when an Indonesia EV enters the market.

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