Electric Vehicle Incentives Uncertainty Continues into 2026

Industry and Consumers Adopt Wait-and-See Approach

As Indonesia enters 2026, the fate of electric vehicle (EV) incentives remains unclear, casting a shadow of uncertainty over the industry. The lack of clarity on government support has led to a slowdown in sales as both consumers and manufacturers choose to wait for official announcements before making significant decisions.

Impact on Industry Health

Tenggono Chuandra Phoa, Secretary General of the Indonesian Electric Vehicle Industry Association (Periklindo), expressed concerns that the absence of official regulations regarding Value-Added Tax (VAT) incentives for EVs is creating unhealthy market conditions. The uncertainty surrounding these incentives is affecting the overall growth and development of Indonesia's EV sector.

Market Implications

The electric vehicle industry is particularly sensitive to government policies and incentives. Without clear guidance on the continuation of incentives, both local manufacturers and consumers are hesitant to invest in or purchase electric vehicles. This hesitation could potentially slow down Indonesia's transition to more sustainable transportation options.