Jakarta (ANTARA) - Cooperatives and Small and Medium Enterprises Minister Teten Masduki expressed belief that Indonesian automotive micro, small, and medium enterprises (MSMEs) would be able to adapt to the trend of transition to electric vehicles (EV).

"I have visited (automotive MSMEs), and I believe that they are ready to switch (to EV) and conduct research and development to create associated components. Their business instinct will surely drive them to develop other products," he remarked in Jakarta on Monday.

He noted that the penetration of EVs in Indonesia poses both a challenge and an opportunity for automotive MSMEs to develop related innovative products.

Masduki underscored that Indonesia possesses enormous potential in its automotive sector, considering that the sector has been attracting foreign investors and that Indonesian youngsters wield the capability of modifying vehicles.

"I know for sure that plenty of investors are aiming for Indonesia," he stated.

Related news: Govt asks MSMEs to help develop EV ecosystem

Earlier, on March 8, the minister urged automotive industry players in Indonesia to step up their partnership with automotive MSMEs to support downstreaming.

According to Masduki, automotive small and medium enterprises have been supplying 65 percent of the vehicle components and heavy equipment in Indonesia.

Based on data from Statistics Indonesia (BPS), the automotive industry contributed Rp311 trillion (US$19.6 billion), or around nine percent, to the total gross domestic product of the non-oil and gas processing industry in 2023.

Meanwhile, the growth rate of the automotive industry during the 2018-2023 period was registered at 4.1 percent.

Data from the Indonesian Automotive Industry Association (Gaikindo) and the ASEAN Automotive Federation showed that Indonesia produced a total of 1.395 million four-wheeled vehicles and 5.2 million two-wheeled vehicles last year.

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Translator: Aji C, Tegar Nurfitra
Editor: Yuni Arisandy Sinaga
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