Govt Support to National Industry Tested

KOMPAS/RADITYA HELABUMI

Prototype electric vehicles, including an electric scooter and an electric multipurpose vehicle, are displayed on Tuesday (28/8/2018) at the Agency for the Assessment and Application of Technology (BPPT) in Jakarta. The BPPT is improving its development tests on electric cars and motorcycles, as well as on charging stations, chargers and batteries. The domestic manufacturing industry will also be involved in supplying components.

JAKARTA, KOMPAS — Deliberation on the draft Presidential Regulation on accelerated development of electric vehicles has yet to show the government’s full support in encouraging the national electric car industry.

In Indonesia, research on electric vehicles began in 2012 with the National Electric Car (Molina) research program that involved the University of Indonesia (UI), Bandung Institute of Technology (ITB), Sebelas Maret State University (UNS), Gadjah Mada University (UGM) and the Sepuluh Nopember Institute of Technology (ITS).

The research has resulted in an ITS-manufactured electric motorcycle prototype that is ready for mass production. PT Gesits Technologies Indo plans to begin commercially producing 50,000 units of the motorcycle, called Gesits, in November. UNS is to begin daily production of 1,000 battery cells.

Research, Technology and Higher Education Minister Mohamad Nasir said last week in Jakarta that producing the Gesits electric motorcycle was a big step in the national automotive industry.

However, the accelerated development of the national electric vehicle industry does not have the full support of all stakeholders. The draft Presidential Regulation on accelerated development of electric vehicles, initiated by the Energy and Mineral Resources Ministry, remains unfinished.

The regulation is to be the basis for mass production of the electric vehicle concept to incorporate it in the national automotive industry.

The Industry Ministry has opposed one of the articles in the draft Presidential Regulation, which requires that sales of fossil-fuel vehicles be terminated by 2040. According to the ministry, there is no need to restrict domestic sales of fossil-fueled vehicles in the market, which is still controlled by foreign brands.

The ministry’s director general of metal machinery for transportation and electronics industries, Harjanto, recently said that there was no need to test the prototype electric motorcycle. In fact, the Gesits electric scooter, which is a national project, will soon enter the production stage.

Rather than electric vehicles, the ministry instead supported the development of hybrid vehicles that use a combination of petroleum-based fuels and electricity, although no domestic company has mastered hybrid technology.

In fact, to spur the development of hybrid vehicles, the Industry Ministry has proposed an import tax incentive to the Finance Ministry for electrified or electricity-generating classes of vehicles. According to maritime industry, transportation equipment and defense equipment director Putu Juli Ardika, the ministry had proposed a cut of 5-10 percent to 0-5 percent in import duties on completely knocked down (CKD) components.

Electric vehicle development, according to Putu, should follow the Indonesian Automotive Road Map, which begins with hybrids, followed by plug-in hybrids and finally electric vehicles. The Industry Ministry was cooperating with Mitsubishi and Toyota in developing hybrid vehicles

"Mitsubishi is carrying out studies in the cities, while Toyota is conducting studies in the regions. The studies also involve several state universities," he said.

Direct

The Corruption Eradication Commission (KPK), which oversaw the draft regulation on accelerated development of the national electric vehicle industry, said that the Industry Ministry’s proposed import tax incentives on hybrid vehicles would impact the national electric vehicle industry.

KPK advisor Mohammad Tsani Annafari also said hybrid vehicles would continue to use fossil fuels and that the government would be burdened because it would need to provide both gas stations and electricity charging stations.

"The incentive policy must be appropriate. The government must avoid conflicts of interest in adopting policies that could impact state finances," he said.

The Energy and Mineral Resources Ministry\'s data and information center head, Agus Cahyono, said that several ministries had agreed that electric vehicles should not be developed in stages from the initial development of hybrid vehicles. The vehicles could be developed concurrently, so that electric vehicles could be developed without delay.

Maritime Coordinating Minister Luhut Binsar Pandjaitan, who moderated the deliberation on the draft Presidential regulation, said the government was targeting electric cars to contribute 30 percent of the automotive market by 2030. "We hope that electric vehicles will be able to replace fossil fuel-powered vehicles," he said.

(ADY/BKY/MDN/ILO)