Government steers EV incentives toward nickel batteries, sidelim
The plan covers 100,000 electric cars and 100,000 electric motorcycles, with a 40%-100% government-borne VAT break for cars.
The government is steering electric vehicle incentives toward nickel-based batteries or nickel-manganese-cobalt (NMC) as it pushes to build a domestic EV ecosystem. Energy and Mineral Resources Minister Bahlil Lahadalia in Jakarta on Monday said lithium iron phosphate (LFP) batteries are not a priority because Indonesia does not have the raw materials. He said nickel batteries are more suitable for long-distance travel, although NMC-powered vehicles are more expensive. Earlier, Finance Minister Purbaya Yudhi Sadewa said the government is preparing incentives for 100,000 electric cars and 100,000 electric motorcycles in 2026. For electric motorcycles, the support is Rp5 juta per unit. For electric cars, the incentive will come through a government-borne VAT of 40%-100%, with the amount varying by nickel and non-nickel battery types. The final form and effective date of the incentive have not been decided.