automotive

Accelerating Green Automotive Transition, Government Develops Hydrogen Car Incentives

The government continues to strengthen its commitment to encourage the transformation of the national automotive industry towards environmentally friendly technology through the Green Mobility policy. One of the latest strategic steps is the preparation of special incentives for vehicles with hydrogen fuel cell technology, which is considered one of the pillars of the future of sustainable automotive. 

"We welcome the development of automotive technology, including hydrogen-based vehicles, and are ready to facilitate with adaptive and sustainable policies through the Green Mobility approach," said Minister of Industry Agus Gumiwang Kartasasmita in his statement, Wednesday (7/5/2025). 

Hydrogen fuel cells are a zero-emission vehicle technology that uses hydrogen as fuel and only produces water vapor as residue. The Minister of Industry stated that the government has prepared an incentive policy to attract investors to build a hydrogen-based vehicle ecosystem in Indonesia, along with efforts to accelerate the clean energy transition. 

This policy complements various incentives that have previously been provided for ICE (Internal Combustion Engine) vehicles through the LCGC and biofuel programs, as well as electric vehicles through PPNBM DTP and support for the vehicle battery industry. The government has also provided incentives for hybrid vehicles as part of a gradual and inclusive energy transition strategy. 

"Our principle is clear, all investments — both old and new technologies — will be facilitated as long as they produce vehicles that are more environmentally friendly, energy efficient, and support public mobility," added the Minister of Industry. 

The Green Mobility concept itself was developed by the Ministry of Industry as a policy approach that combines energy efficiency, industrial competitiveness, environmental sustainability, and protection of automotive investments that have long grown in Indonesia. 

The great opportunity for the development of environmentally friendly vehicles, including hydrogen, is also driven by the potential of the national automotive market. Until 2024, the ratio of four-wheeled vehicle ownership in Indonesia only reached 99 units per 1,000 residents — far below Malaysia (490 units), Thailand (275 units), and even Singapore (211 units). 

"With a population of 281 million people, there is still a very large room for growth in the domestic automotive market," said Agus. 

More than just expanding the market, the Green Mobility policy is aimed at accelerating the achievement of the Net Zero Emission (NZE) target for the manufacturing industry sector by 2050, even 10 years earlier than the national target. 

Tag: Agus Gumiwang Kartasasmita Green Automotive Transition LCGC NZE