Indonesian Minister of Industry, Agus Gumiwang Kartasasmita, made a striking revelation about the car sales performance in January 2025. According to him, there was a significant decline of 11.3% compared to the figures from December 2024. These numbers were disclosed during the opening of the Indonesia International Motor Show (IIMS) 2025 at JI-Expo Kemayoran in Jakarta on Thursday, March 13, 2025. The automotive sales data from 2024 also painted a bleak picture, with only 866 thousand units sold—marking a 13.9% decrease from 2023.
Agus Gumiwang’s Concerns and Solutions
Addressing the subdued market conditions, Agus emphasized the need for innovative solutions to reignite consumer interest in automotive purchases. He highlighted the current sluggish state of the market and stressed the importance of collaborative efforts among stakeholders, including the government, to revitalize consumer interest in the automotive sector. Agus underscored the necessity for groundbreaking initiatives to stimulate consumer demand for automotive products in the face of a challenging economic climate.
One of the proposed strategies to reinvigorate enthusiasm for automotive shopping is through the implementation of government incentives. This year, the government introduced a 3% Sales Tax on Luxury Goods (PPnBM DTP) incentive for hybrid cars. Moreover, electric vehicles received a significant boost with a 100% PPnBM DTP incentive for both completely built-up (CBU) and completely knocked down (CKD) electric cars—whether imported or domestically assembled. Agus expressed his satisfaction with this decision, acknowledging the extended efforts made to secure incentives for hybrid vehicles in the current fiscal year.
The Economic Significance of the Automotive Industry
As a member of the Golkar Party, Agus underscored the vital importance of the automotive industry from an economic perspective. He emphasized the industry’s backward and forward linkages, which play a crucial role in either strengthening or weakening the national economy. Agus outlined the economic repercussions of the sales decline in 2024, estimating a substantial impact on the backward linkage of Rp 5.4 trillion and the forward linkage of Rp 4.6 trillion. These figures underscored the intricate economic interconnections within the automotive sector and their broader implications for the national economy.
The Indonesia International Motor Show (IIMS) 2025, a premier automotive event, is expected to serve as a platform for rekindling consumer interest in automotive purchases. Agus’s presence at the event signifies a concerted effort to engage with consumers, industry players, and policymakers to foster a more vibrant automotive market landscape that benefits all stakeholders involved. The Minister’s commitment to addressing the challenges facing the automotive sector reflects a proactive approach to stimulating growth and innovation in the industry.
By shedding light on the current state of the automotive market and proposing strategic interventions to drive consumer demand, Agus Gumiwang Kartasasmita has emerged as a key advocate for revitalizing the automotive industry in Indonesia. His vision for a resilient and dynamic automotive sector underscores the transformative potential of collaborative initiatives and forward-thinking policies in navigating the complexities of the contemporary economic landscape. As the automotive sector continues to evolve, Agus’s leadership and strategic insights will play a pivotal role in shaping the industry’s trajectory and fostering sustainable growth in the years ahead.
