Indonesia Battery Eyes Surge in Electric Scooter Sales with Incentive Plan

JAKARTA: State-owned battery company Indonesia Battery Corporation (IBC) aims to boost its domestic market share of electric motorcycles to up to 30% as the government seeks to accelerate the adoption of electric vehicles, the company said. the chief executive said Friday.

The government aims to reach 2 million electric motorcycle sales by 2025. Indonesia is attracting billions of dollars of investment to process its rich nickel reserves into battery materials.

According to industry data, less than 40,000 electric motorcycles were sold in Indonesia between 2019 and 2022, while the total number of motorcycles sold was 5.22 million in 2022 alone.

Last year, IBC acquired a majority stake in PT Wika Industri Manufaktur, manufacturer of electric scooters Gesits. The company currently has an annual production capacity of 40,000 units.

“Production capacity could reach 75,000 to 100,000 units in the next few years. So, out of the government’s overall target, our target is to have a market share of 25% to 30%. It’s good,” said Totonuguroho, chief executive of IBC. Reuters.

Indonesia plans to donate 7 million rupiah ($459.92) for the purchase of one electric scooter to boost sales, which Toto said will lead to a surge in demand.

“This is what happened in China 10 years ago. Now their (annual) sales of electric motorcycles have reached more than 30 million units,” he said.

The Indonesian government aims to sell 300,000 electric motorcycles by 2023.

Toto said an IBC study found that one of the main issues affecting the adoption of electric scooters is pricing, with concerns about charging infrastructure and rising interest rates on EV loans continuing. .

IBC is a local partner of major global battery manufacturers such as CATL Group in China and LG in South Korea. These companies plan to build a major facility in Indonesia to develop batteries.

LG will begin construction of its $1.1 billion battery plant in 2021, and TOTO said it is on track to start production in 2024, reaching about 70% completion.

The power plant has a capacity of 10 GWh, enough to power 200,000 electric vehicles or up to 2.5 million electric scooters.

IBC will also assemble its own battery packs to help reduce the price of e-bikes by about 15 percent, Toto said.

($1 = 15,220.0000 Rupiah)

(Editing by Martin Petty)