Energy analyst Putra Adhiguna of IEEFA examines Indonesia’s policy directions and the potential clash with the intentions of legacy automakers currently operating in Indonesia. For a summary fact sheet,Japanese carmakers dominate the light car market: Honda, Mitsubishi, Suzuki, Toyota, and its subsidiary Daihatsu command 92% of the market. These companies are not famous for progress with electric vehicles.
“EVs consume energy about three times more efficiently than traditional internal combustion engine vehicles , which convert only 12% to 30% of the energy in the fuel tank to power the wheels,” the report’s author Adhiguna tells us. This means, that even with a coal-dependent grid, EV adoption can ease oil demand growth and lower life-cycle emissions.
Indonesia currently plans to implement a progressive vehicle tax based on emissions and fuel consumption and to introduce some subsidies. Carrot and stick — this has worked in jurisdictions like Norway and New Zealand. Adhiguna fears that legacy OEMs will further delay the transition by reliance on HEVs and prolonging the production of ICE vehicles in the emerging market.