Indonesia plans incentives for EV makers, sets up meeting with BYD, Tesla

JAKARTA  – Indonesia is finalizing a new set of incentives to attract investment from manufacturers of electric vehicles (EVs), a senior minister said on Tuesday, adding the government is still in talks with major companies like Tesla and BYD.

Speaking at a nickel industry conference hosted by CNBC Indonesia, Coordinating Minister of Maritime Affairs and Natural Resources Luhut Pandjaitan said the incentives would be benchmarked against those offered by regional rivals Thailand and Vietnam, but did not provide details.

Indonesia, the largest economy in Southeast Asia, has been trying to attract EV makers to invest in the country, enticing them with its rich nickel reserves – the world’s biggest – which can be processed into EV batteries.

READ: Like Musk, nickel-rich Indonesia has high electric vehicle ambitions

However, some automakers like China’s BYD have instead chosen to invest in Thailand, the region’s automotive hub.

“Tomorrow we are going to finalize incentives that we are going to give to any EV investment in Indonesia,” Luhut said, adding they were awaiting President Joko Widodo’s approval.

READ: Indonesia lowers VAT on electric vehicles to 1% from 11%

Luhut said he will meet BYD executives in China’s city of Chengdu on Thursday, and a meeting is also scheduled on August 3 with Tesla’s chief executive Elon Musk in California, United States.

Indonesia has been wooing Tesla for years, hoping to host an Asian production hub for the American EV maker. Tesla has been in talks with Indian officials for an investment in an EV factory there.

READ: Indonesia close to EV deals with BYD Group and Tesla – minister