Jakarta, INTI - The Indonesian Automotive Parts and Components Industries Association (GIAMM) believes the country's automotive components industry has become increasingly resilient, reinforcing its position in the global supply chain through growing exports, stable production capacity, and continued government support led by the Ministry of Industry.
Productivity Drives Global Competitiveness
GIAMM Secretary General Rachmat Basuki said Indonesia’s automotive components sector has entered a new phase of expansion, with manufacturers now supplying international markets as an integral part of global supply chains.
According to Basuki, the industry's ability to compete internationally depends on continuously improving productivity to match manufacturers from other countries.
He noted that the Ministry of Industry’s initiatives, including the implementation of Industry 4.0 technologies and workforce development programs, have helped manufacturers enhance productivity while accelerating the adoption of modern production processes.
Basuki also highlighted the government's support during the COVID-19 pandemic, stating that strict health protocols enabled automotive component manufacturers to maintain operations, ensuring uninterrupted production and stable global supply chain deliveries.
In addition, government incentives for the automotive sector helped sustain domestic vehicle demand, allowing component manufacturers to keep production lines running.
"As four-wheel vehicle production increased, demand for automotive components naturally continued to grow," he explained.
Exports Reach More Than 100 Countries
GIAMM data shows that Indonesia’s four-wheel automotive industry expanded by 14% year-on-year in the first quarter of 2026, while the two-wheel vehicle market remained stable, supporting consistent production capacity across the automotive components sector.
Basuki added that the government continues to promote industrial transformation through its Low Carbon Emission Vehicle (LCEV) program, covering technologies ranging from internal combustion engine (ICE) vehicles to battery electric vehicles (BEVs).
The initiative is also designed to gradually increase Indonesia’s domestic content requirement (TKDN), with a long-term target of reaching 80% local content.
"The government continues to encourage the industry through supportive regulations that help manufacturers integrate more deeply into global supply chains," Basuki said.
GIAMM reported that throughout 2025, Indonesia’s automotive components industry exported products to more than 100 countries, generating export revenues exceeding US$7 billion. The United States, Japan, South Korea, and ASEAN countries remained the industry's primary export destinations.
Conclusion
Indonesia’s automotive components industry is strengthening its position as a key player in the global supply chain, driven by robust export performance, sustained production capacity, and ongoing government support. As manufacturers embrace Industry 4.0 technologies, improve productivity, and expand into low-emission vehicle supply chains, the sector is well positioned to enhance its global competitiveness. With exports surpassing US$7 billion and reaching more than 100 countries in 2025, the industry is expected to remain a significant contributor to Indonesia’s manufacturing growth and international trade.
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