China Automaker Invests US$1.3bn to Build Factory in Indonesia

TEMPO.CO, Jakarta - China's electric car manufacturer BYD (Build Your Dream) will invest US$1.3 billion or around Rp20.3 trillion to build a factory in Indonesia this year, Coordinating Minister for Economic Affairs Airlangga Hartarto said.

"The production capacity will be 150,000 per year," said Airlangga in the video of his speech at the BYD Grand Launching event in Jakarta, on Thursday, January 18.

For now, three of BYD's electric car products Atto 3, Dolphin, and Seal are still exported from China to Indonesia in completely built-up (CBU) form.

"Our megafactory will be where we assemble cars for the Indonesian market," BYD Motor Indonesia president director Eagle Zhao said.

Meanwhile, BYD Asia-Pacific general manager Liu Xueliang said that the company is conducting studies to build a factory in Indonesia. "If we build a factory here, we have to serve the local market as much as possible," said Liu.

Previously, Coordinating Minister for Maritime and Investment Affairs Luhut Binsar Pandjaitan said that BYD would assemble its cars locally in a completely knock-down (CKD) form in Indonesia. While waiting for the factory to finish construction, Luhut said that the government allowed BYD to sell its cars in Indonesia in a completely built-up (CBU) form from China.

The government will waive import taxes for BTD electric cars imported to Indonesia. According to regulations, tax exemption only applies to automotive manufacturers who have committed to building factories in Indonesia.

"We are not opening up EV imports, we are giving incentives only to potential investors. Without investing here, the import duties will be the same, we won't relax them," Luhut said. 

Dicky Kurniawan

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