Indonesia is witnessing a major electric vehicle manufacturing boom as both BYD and VinFast are constructing massive production facilities set to begin operations in 2026, marking a significant shift in the country's automotive landscape.
VinFast, the Vietnamese automaker, is establishing its factory in Subang with an investment reaching Rp 185 trillion, targeting an annual production capacity of 50,000 units once operational, according to the company's official plans.
BYD, the Chinese electric vehicle giant, is also building its manufacturing plant in Indonesia with investments totaling trillions of rupiah, aiming to commence production by 2026 as part of its Southeast Asian expansion strategy.
However, both manufacturers face a critical challenge as their initial production phases in 2026 will not yet incorporate local components, which could affect their integration into Indonesia's automotive ecosystem and compliance with local content requirements that typically offer incentives for EV producers.
These multi-trillion rupiah investments represent Indonesia's growing position as a strategic hub for electric vehicle production in Southeast Asia, potentially creating thousands of jobs and accelerating the nation's transition toward sustainable transportation, though the absence of immediate local component adoption raises questions about the timeline for deeper supply chain integration.
