Indonesia woos Toyota to move production out of Thailand, promises incentives

Indonesia's finance minister Purbaya Yudhi Sadewa used his speech at GIIAS 2026 on 4 August to urge Toyota to relocate its car production from Thailand to Indonesia, offering to deliver the incentives Toyota seeks if the company agrees to move its manufacturing activities.

Speaking at the Indonesia Convention Exhibition (ICE) BSD during the Gaikindo Indonesia International Auto Show, Purbaya framed the call as part of a push to expand Indonesia's industrial base and follow recent investment wins such as Hyundai's decision to build manufacturing capacity in the country.

Purbaya told Toyota to transfer “all your manufacturing activities from Thailand to Indonesia,” and said the government would provide the range of incentives the automaker requests. That said, no specific incentive details were provided during the address.

The minister highlighted recent regulatory reforms intended to improve the domestic investment climate, including streamlined licensing processes across ministries and agencies — reforms Jakarta presents as aimed at speeding project approvals and reducing bureaucratic friction for automakers and suppliers.

Economic rationale cited by the minister places manufacturing at the centre of national growth policy. Purbaya said the automotive sector has driven employment gains, with the number of Indonesians employed in the automotive industry increasing by 1.5 million, and that auto manufacturing supports related fields from steel and electronics to logistics and finance.

Official trade body data referenced at the event shows Toyota and Lexus wholesale vehicle volumes in the first half of 2026 totaled 134,520 units, equivalent to 30.8% of Indonesia's domestic wholesale market of 436,567 units for H1 2026, underscoring Toyota's current market footprint in the country.