Lower EV motorcycle subsidy may stall adoption, industry warns

President Prabowo Subianto announced a subsidy program for 1 million locally produced electric motorcycles during his August 14 state budget speech, promoting the initiative as advantageous for consumers, energy security, and employment. However, the Indonesian Electric Motorcycle Industry Association (Aismoli) has expressed concern that decreasing the electric motorcycle purchase incentive from Rp 7 million (US$395) to Rp 3 million per unit may reduce consumer demand.

Aismoli's public relations and events executive, Ririn Rinawati Sinaga, explained that the reduced incentive will likely impact affordability and public interest in transitioning to electric two-wheelers. She noted that the association had previously analyzed how different incentive amounts affected the electric motorcycle market, potentially revisiting the study to measure the effects of the lower subsidy.

While acknowledging the industry's demand for regulatory certainty and prompt implementation, Ririn emphasized that the association's main concern is ensuring certainty regarding the Rp 3 trillion budget allocation.