Electric Motorcycle Incentive 'Only' Rp3 Million, Business Leaders Highlight State Budget and Demand This

The government has prepared an incentive of Rp3 million per unit for electric motorcycle purchases. The programme has a budget of Rp3 trillion and is directed at supporting the purchase of up to 1 million domestically produced electric motorcycles.

Finance Minister Purbaya Yudhi Sadewa previously said the distribution of the incentive was unlikely to reach the target of 1 million units this year. The government also estimates that sales utilising the incentive will only reach around 100,000 units by the end of 2026.

Chairman of the Indonesian Electric Motorcycle Industry Association (Aismoli), Budi Setiyadi, said the incentive amount does need to be adjusted to the government’s budget capacity. However, the industry needs certainty regarding the scheme that will apply so it can prepare a clearer business plan.

“Well, actually it is relative, whether it is enough or not really depends, but we understand, the state budget capacity of the government, whose priorities are now very visible and so on,” Budi told CNBC Indonesia on Monday (24/8/26).

For industry players, the nominal incentive is not the only factor determining market movement. The duration of the programme is also a consideration because production and investment decisions require a longer time horizon.

Budi hopes the government will not make the incentive programme for only one budget year. A scheme that applies for several years is considered able to provide room for the industry to prepare capacity while encouraging consumers to make purchasing decisions.

“Actually, we also have a thought that ideally, if possible, it could be the same as 2023-2024, which was Rp7 million per unit. If that is not possible, we understand because the government knows better. But what is actually important is the scheme, the scheme and the time period,” he said.

Certainty over timing is becoming increasingly important because information about the incentive has appeared several times in the market. Too long a gap between announcement and implementation can make consumers choose to delay purchases while waiting for the final rules.

Budi said this pattern occurred in the previous period.

He hopes the government’s decision this time can be immediately followed by technical regulations so that industry and the public do not return to a state of waiting.

“And then besides the scheme, perhaps with multi-year, there is also the tenor of time, meaning it should be quite long, not just one year. As for the amount, we are relatively flexible. Because the government has also previously mentioned possibly using VAT borne by the government, and with VAT borne by the government the figure is not big either. Then Rp7 million appeared, then it was also mentioned as Rp7 million, and now the Finance Minister has said Rp3 million. So what is important is certainty,” Budi said.

That certainty will determine the market response after the government announced the Rp3 million per unit incentive. Without clarity on execution timing, consumers could again hold back purchases and make the electric motorcycle market even more difficult in chasing the targets set by the government.

“What is important is certainty so that the industry is not affected, and the public can perhaps immediately utilise the scheme. What happens if there is no certainty is that the public will wait, waiting for when, so in the end there are no sales, and we have dropped a lot this year,” Budi said.