Indonesia’s car market is cooling, but sales of electric vehicles (EVs) are bucking the trend, offering the auto industry new optimism amid weaker household spending.

Total vehicle sales slid from around 1 million units in 2023 to about 800,000 in 2024, according to data from the Association of Indonesian Automotive Industries (Gaikindo). The slowdown has fueled concerns that the industry may struggle to meet its performance targets this year.

Yet within that broader decline, EV demand is rising. Wholesale deliveries of hybrid electric vehicles (HEV), battery electric vehicles (BEV), and plug-in hybrid electric vehicles (PHEV) reached 66,187 units in the first half of 2025, up 17% year on year.

The sharpest gains came from BEVs and PHEVs, whose combined sales climbed to 37,370 units in 2025, more than double the 17,179 units sold in 2023. The surge points to growing consumer confidence in fully electric technology.

Hybrids remain resilient, with 28,817 units sold this year. Though slightly lower than the previous year, HEVs still appeal to buyers seeking a middle ground between conventional and fully electric cars.

Chinese automakers are leading the charge in Indonesia’s EV transition. Wuling, BYD, and Denza accounted for much of the BEV and PHEV momentum in early 2025, while Japanese giants Toyota and Suzuki maintained dominance in the hybrid segment.

The arrival of more affordable models and advances in battery efficiency are helping drive consumer uptake. Public and private investment in charging infrastructure, including a growing network of state-owned SPKLU charging stations, has further supported the trend.

Government incentives and regulatory shifts are also shaping the EV landscape. From tax breaks to planned restrictions on fossil-fuel vehicles, policies are creating both carrots and sticks for consumers and automakers.