Chinese automotive brands are rapidly gaining ground in Indonesia, recording a 153 percent year-on-year increase in vehicle sales during the first quarter of 2025 -- even as the overall market declined by nearly 5 percent, according to the Indonesian Automotive Industry Association (Gaikindo).

Chinese carmakers sold 20,672 units between January and March, up from 8,148 in the same period last year. In contrast, national car sales fell 4.7 percent, from 215,160 to 205,160 units. Chinese brands now command 10 percent of the Indonesian auto market, a sharp increase from just 3.83 percent a year earlier.

The key to their success? Electric vehicles (EVs) -- a segment still underdeveloped among Japanese manufacturers.

Japanese Brands Losing Ground

Aside from Toyota, nearly all major Japanese brands posted declining sales:

Daihatsu: -23.9% to 34,999 units

Honda: -20.4% to 22,336 units

Suzuki: -20.4% to 14,174 units

Mitsubishi: -15.6% to 21,692 units

Isuzu: -13.7% to 5,911 units

Toyota defied the trend with a 5 percent increase to 68,955 units, maintaining its lead with a 33.6 percent market share. Japanese automakers overall now hold 85.6 percent, down from 91.7 percent in Q1 2024.

BYD Leads EV Charge

Chinese EV giant BYD made a powerful debut in Indonesia in July 2024 and has quickly become the top-selling EV brand, moving 5,718 units in Q1 2025.

Its premium electric minivan, the Denza 9, sold 2,524 units in just a few months, challenging Toyota’s dominance in the luxury MPV segment. With a starting price of Rp 950 million and access to generous EV tax incentives (2% vs. 40% for hybrids and ICEs), the Denza 9 has earned the nickname “Alphard killer.”

Meanwhile, fellow Chinese brand Chery reported a 187 percent surge to 4,399 units, also driven largely by EV sales. Wuling, despite its early market entry and local manufacturing, posted a 12.1 percent decline to 4,795 units.

Consumers now have access to a wide range of Chinese auto brands including Aion, MG, Geely, Jetour, BAIC, and Haval.

“Chinese brands aren’t growing the market -- they’re eroding the market share of Japanese automakers,” said industry analyst Yannes Martinus Pasaribu.

EV Momentum in Indonesia

EVs now account for 4.9 percent of total car sales in Indonesia, up from 1.7 percent in 2023, largely driven by competitively priced Chinese models with futuristic designs and high-tech features.

“Chinese cars are 15–20 percent cheaper, and their production models are far more efficient than their Japanese, Korean, or European counterparts,” Yannes said. “The success of Denza 9 proves Chinese brands are no longer limited to budget segments.”

China now dominates the Indonesian EV market with a 90 percent share, followed by South Korea at just 6 percent, he noted.

“Chinese cars are no longer secondary options -- they’re emerging as potential market leaders,” Yannes said.

Japanese Automakers Bet on Hybrids

Despite strong EV growth, Japanese carmakers continue to push hybrid technology as a more practical choice for Indonesian consumers.

Astra International, the official distributor for Toyota, Daihatsu, and Isuzu, is holding off on expanding its EV lineup.

“Hybrid is the most realistic solution for Indonesian mobility,” said Henry Tanoto, Director at Astra. “We plan to introduce hybrid variants for our mass market segment soon.”

Astra currently offers 15 hybrid models, and Henry emphasized the group’s resale value advantage and after-sales ecosystem.

“EV buyers still have concerns -- charging access and resale value remain barriers. Many still see EVs as a secondary vehicle,” he added.

Hybrid cars, on the other hand, have wider geographic adoption, including in satellite cities, not just urban centers.

In Q1, Astra sold 110,812 vehicles across its brands, securing a 54 percent market share.