Jakarta – Electric car prices in Indonesia are poised for further declines in the coming years,potentially accelerating adoption of the vehicles,according to industry observers. The anticipated drop is linked to decreasing battery production costs, a key component of electric vehicle (EV) pricing.
Automotive Observer Yannes Pasaribu predicts battery production costs will fall to around $67 USD per kilowatt-hour (kWh) within 4-5 years, nearing 2030. “it seems like all the fossil fuel vehicle industries, except for petrol head hobbyists, will likely have to change businesses, because the production costs will be cheaper, because these batteries cost 20 to 40 percent of the vehicle price,” Pasaribu stated during a presentation at the detikcom Leaders Forum on Wednesday, November 12, 2025.
Indonesia holds a strategic position in the EV battery supply chain as the nation with the world’s largest nickel reserves. The Ministry of Energy and Mineral Resources (ESDM) reported 5.9 billion tonnes of nickel ore reserves and 62.02 million tonnes of nickel metal as of 2024,with 173.6 million tonnes of nickel ore produced throughout the year.
A meaningful advancement in this sector is the establishment of Southeast asia’s largest lithium battery factory, operated by PT Industri Batteries Indonesia (IBC) in collaboration with brunp and Lygend (CBL), a subsidiary of Contemporary Amperex Technology Co. Limited (CATL). The factory, located in Karawang, represents an investment of US$5.9 billion (approximately Rp. 95.5 trillion, based on an exchange rate of rp. 16,192) and was inaugurated by President Prabowo Subianto on June 29, 2025.
“If batteries that cost 20-40 percent can start to be produced (locally), this will accelerate the decline in battery prices, and accelerate the decline in the price of electric cars. Don’t forget that Indonesia will become a hub for the ASEAN region,” Pasaribu added.
Data from the United States Department of Energy (DOE) illustrates the trend of falling battery costs, dropping from approximately $1,415 per kWh in 2008 to $139 per kWh in 2023 – a roughly 90% decrease over 15 years, adjusted for inflation.