While China turns its attention to local EV brands over Tesla, the natural resources of Indonesia have great potential for its battery production industries. Asia starts to look like the U.S. and Europe can overtake the electric car market because the impact of the global pandemic continues to improve.
CNBC consumer research indicates that the pricing and driving range mainly concerns Chinese consumers when it comes to EVs. In 2020, sales by local EV companies such as Nio, Xpeng and Li Auto remained steady and their stock prices increased despite a decline in automobile demand.
Although Tesla continues to lead the market, the innovative startups in China will soon be able to threaten this position. Nio’s basic EV options are considerably cheaper than its U.S. counterpart, although there are several additional functions at a cost.
With its projected uptake of 11 to 14% by 2022, China is one of the fastest growing electrical devices markets, just behind the 12-15% projections of Europe. Today China is the world’s largest electricity market with sales of about 1.2 million electricity in 2019. The country is expected to increase Chinese electronic equipment market faster than the US. Thanks both to its rapid response to the Covid-19 pandemic and the economic recovery.
The $3,600 government support for buying EVs by 2022 provides significant incentives for consumers to switch from conventional powered automobiles. Furthermore, EVs are exempt from buying tax until now. Although the market has declined in response to the global pandemic, it will steadily increase as the economy increases.
In the meantime, Indonesia has eyes on his potential to generate batteries. It is perfect for essential EV components, thanks to its natural resources, including nickel, copper, bauxite and nickel.
The production of Lithium-ion batteries is planning for Indonesia to be a major part of the EP supply chain. At present, it has around one quarter of the world’s nickel reserves that are key to the production of batteries.
However, if it wants to establish itself as one of Asia’s major EV component producers, the country has to invest beyond production. Tech, talent and renewables are only some areas in which manufacturing has to be developed by hand.
The government of Indonesia plans to increase investment of 35 billion dollars in electricity batteries by 2033. In addition, the mining and manufacturing sectors of Indonesia are invested in the research and development of such energy sources by China and other regional authorities.
After the price cut from 24 percent last month to 46,700 dollars in February, Tesla still holds high sales in Japan for its long-range Model 3 car. Many are switching to the ambitious goal of the government of prohibiting gas-engine car sales by the mid-2030s.
Moreover, rather than increasing the availability of the car in the region, Japan is now able to import the Teslas from Shanghai.
Although Tesla CEO, Elon Musk said that Japan was one of the most important markets, a large proportion of Japanese people haven’t heard of their car yet, compared with more well known local car manufacturers such as Nissan.
Although Europe remains ahead of the EV market, Asia is constantly catching up thanks to the favorable policies that promote EV sales. In countries such as Japan and India it is also increasing the core market foundation for EVs.
The Asian EV market is booming with Asian governments beginning to phase out the sales of gasoline vehicles and implement policies that encourage EV sales, like subsidies and tax breaks. While the United States continues to struggle against the global pandemic with a loaded economy and poor demand, Asia is starting to bounce back to become a key car market.