How Much Could Electric Motorcycles Cut Indonesia's Fuel Subsidies?

August 20, 2026 | 05:48 pm

TEMPO.CO, Jakarta – Indonesia's National Electric Motorcycle Program (Molinas) is projected to save Rp82.2 trillion in fuel subsidies between 2027 and 2037, assuming 11 million electric motorcycles are in operation by 2037, the Coordinating Ministry for Economic Affairs said.

“The fuel subsidy savings, assuming 11 million units are operating in 2037, would amount to Rp82.2 trillion,” Atong Soekirman, Assistant Deputy for Industrial Development at the Coordinating Ministry for Economic Affairs, said in Jakarta on Thursday, August 20, 2026.

The government is targeting annual production capacity of 100,000 Molinas units, with domestic component content (TKDN) initially set at 40 percent and expected to increase to 60 percent.

Beyond reducing fuel subsidy spending, the program's ecosystem is projected to generate up to Rp150 trillion in economic value between 2026 and 2031 and create around 215,000 jobs across manufacturing, component production, battery manufacturing, and charging infrastructure.

Boosting Domestic Industry

Atong said the program is also expected to strengthen Indonesia's trade balance by reducing oil imports, with import substitution estimated to be worth Rp45 trillion.

Molinas was launched on August 13, 2026, as part of the government's strategy to develop a national electric motorcycle ecosystem.

The program was initiated by BPI Danantara in partnership with state-owned electronics manufacturer PT Len Industri. Rather than focusing solely on launching a single motorcycle brand, Molinas is designed as an integrated ecosystem covering manufacturing, batteries, financing, and market absorption.

President Prabowo Subianto officially launched the domestically produced national electric motorcycle and its supporting ecosystem at the production facility of PT Ilectra Motor Group (ALVA) in Cikarang, Bekasi Regency, West Java, on August 13.

“On this Thursday, August 13, 2026, with the grace of Almighty God, I, Prabowo Subianto, President of the Republic of Indonesia, officially launch the national electric motorcycle along with its supporting ecosystem,” Prabowo said during the launch ceremony.

Prabowo was accompanied by several Cabinet ministers and business representatives, particularly executives from companies involved in mass-producing electric motorcycles.

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