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EV Ecosystem To Expand In Indonesia



Indonesia is planning to build its own Electric Vehicles (EV) ecosystem. According to The Minister of Energy and Mineral Resources’ roadmap, there would be a potential of 2.2 million electric cars, 13 million electric motorbikes, and 31,859 units of Stasiun Pengisian Kendaraan Listrik Umum (SPKLU) by 2030. Indonesia’s vast fleet of EVs is expected to suppress gasoline imports up to 6 million kiloliters. Through the incorporation of the Indonesia Battery Corporation (IBC) and the development of the SPKLU infrastructure network, Indonesia would hopefully take part in the global battery supply chain. IBC is a nickel and battery plants manufacturer, managed under four State-Owned Enterprises (SOEs), Mind Id, Aneka Tambang, Pertamina, and PLN. Pertamina has allocated Rp45 trillion in hopes of greater collaboration in developing the EV ecosystem. “Hopefully, we can synergize with each other and not be limited to SOEs to develop the EV ecosystem massively,” said Pahala Nugraha Mansury, Vice Minister of SOEs (11/9). PLN is also committed to providing comfort and convenience for EV users and business actors. As of now, PLN has built 47 units of SPKLU and the number would increase by 67 units by the end of the year. On the other side of the road, PT Hyundai Motor Manufacturing Indonesia (HMMI) would launch its first electric vehicle in March 2022, producing 1,000 vehicles every year. Not only HMMI, but Indika Energy (INDY) also prepares to enter the EV ecosystem with the first electric car from Indonesia, Merah Putih.


Views on the development of electric vehicles also make sentiment in the capital market. Billionaire, the founder of Microsoft, Bill Gates, mentioned that investing in oil company shares will not provide long-term prospects. This is because the world is moving away from fossil fuels and adopting cleaner and renewable energy sources. According to CNBC International, Gates said the oil giant, which has dominated the market for more than a century, could be in trouble in the next 30 years in line with current world developments. "Some of these giants will fall. You know, 30 years from now, some of those oil companies will be worth very little," Gates said on Sunday (7/11). Gates added that many large oil companies are currently starting to direct their business to renewable energy forms that have a chance to survive. But unfortunately, this was denied by the International Energy Agency analyst Heymi Bahar. He considered big oil companies unlikely to be leaders in renewable technology. However, last week at the COP26 climate summit in Glasgow, Scotland, Gates said that he believed oil companies could transition their business relatively easily from fossil fuels to cleaner energy sources. Even so, Gates' track record of investments is not as optimistic as his words. This is reflected in his book 'How to Avoid a Climate Disaster,' released in 2019. In this book, he says that he has relinquished his direct ownership in oil and gas companies.


Inducing it back to our home country, the Indonesian government aims to become a regional centre for producing 600,000 electric automobiles and 2.5 million electric motorbikes by 2030. In accordance with the EV sector, the government is also formulating an ambitious strategy to become a prominent participant in the worldwide lithium-ion battery supply chain. "The battery is the most important component inside an EV, accounting for 35% of production expenses," Industry Minister Agus Gumiwang Kartasasmita remarked at the Investor Daily Summit. Private-sector transportation firms have also declared intentions to put thousands of electric cars (EV) on the road, which could also accelerate EV adoption in Indonesia by also increasing the demand for its charging station network. Senior expert Rahul Gupta of management consulting company McKinsey & Company stated that ride-hailing, taxi, and feet services are going to touch on two of three variables that will enhance EV adoption in Indonesia, significantly increasing customer knowledge and demand and decreasing the total cost of ownership (TCO). "Firstly, they account for a significant number of vehicles running on the road, and there is a pull from consumers to adopt EV. Secondly, given the high average daily distance that ride-hailing and taxi drivers run, it helps improve the TCO competitiveness with internal combustion engine [ICE] vehicles," Gupta told The Jakarta Post on Wednesday (11/3). As the implementation of the EV ecosystem continues to grow, it sets the expectation of highly anticipated industries to foster and create more valuable investment opportunities for the people.


Sources

CNBC Indonesia

Kontan

The Jakarta Post


Brought to you by Mandiri Tunas Finance

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