Wuling Boss Speaks Openly About EV TKDN Challenges in Indonesia
The development of the national electric vehicle industry still faces issues regarding the component supply chain. The automotive industry assesses that the capability of local suppliers is not yet fully prepared to support localisation targets and the level of domestic component content (TKDN) for electric vehicles.
Arif Pramadana, Vice President of PT SGMW Motor Indonesia (Wuling), stated that industry players fundamentally support government regulations regarding the increase of TKDN. However, implementation on the ground still faces various obstacles.
“In essence, we will support all regulations provided by the government, but the fact is on the ground, we still encounter certain difficulties in achieving the TKDN or localisation requested by the state,” said Arif during a working meeting with Commission VII of the Indonesian House of Representatives (DPR RI) on Monday.
One of the biggest problems lies in the readiness of local suppliers. According to Arif, the national component industry still faces challenges in terms of technology, production consistency, and pricing.
“Mainly, in terms of the readiness of existing suppliers in Indonesia, the suppliers or the component industry in Indonesia are not yet mature enough to support the TKDN in Indonesia,” he said.
The issue is further complicated because electric vehicles introduce new technologies that require different capabilities compared to conventional vehicles.
“So, in terms of technology, consistency, and the pricing available in the field, that is what we are facing now,” said Arif.
Local suppliers also question the benefits they receive when they successfully meet TKDN requirements. This is because the incentives provided by the government are deemed not to directly reach the component industry. Therefore, the government needs to pay attention to the component industry progressively, from Tier 1 to Tier 3. Such support is necessary so that the local industry can develop technology and production capacity.
“For instance, if they have achieved or can support the attainment of TKDN, what can they receive from the state? That is what they are questioning,” said Arif.
He hopes that the government will not only demand vehicle manufacturers to increase local content but also assist the supplier ecosystem to meet industry needs.
“Through this forum, I also hope to convey that moving forward, I hope the government can look at Tier 1, Tier 2, and Tier 3,” he said.
“How the government can support them, their industry, to be able to develop so that we can become sufficiently sophisticated local players in this latest technology,” added Arif.