For decades, Japanese automotive manufacturers have held a significant position in Indonesia's automotive market. Chinese brands are expanding their presence in the country with competitively priced vehicles offering a range of features.

Chinese-branded passenger cars and commercial vehicles recorded an 82% increase in wholesale shipments between January and July 2026 compared with the same seven-month period last year, according to industry data released on August 22nd, 2026, by the Association of Indonesia Automotive Industries (Gaikindo).

The expansion of Chinese manufacturers reflects a broader shift in emerging Asian automotive markets. Supported by government incentives for electrification and integrated supply chains, Chinese automakers are using new energy vehicles (NEVs), including battery-electric and plug-in hybrid models, to compete with Japanese manufacturers such as Toyota and Honda, which have historically accounted for more than 85% of Indonesia's four-wheeler market.

BYD and Jaecoo lead Chinese brands

Indonesia's overall automotive market expanded through July, with wholesale deliveries across all brands increasing by 18.3% year on year during the first seven months of 2026. Retail registrations also increased by 12.3%.

Chinese brands accounted for a significant share of the increase, with more than half of their total deliveries concentrated in BYD and Chery-backed Jaecoo.

Shenzhen-based BYD ranked fifth among all automotive brands in Indonesia, with a 5.8% market share, while Jaecoo ranked eighth with a 4% share.

In July 2026, total industry wholesale volume increased by 4.5% month on month, while retail deliveries rose 3.6%. BYD ranked fourth in the national retail market during the month and recorded higher sales than Honda in the domestic passenger car segment.

Chinese brands record broader gains

Chinese manufacturers have also expanded their presence beyond passenger cars. Gaikindo's membership now includes 18 Chinese automotive manufacturers, including commercial vehicle producers First Automobile Works (FAW) and Farizon, the commercial vehicle division of Geely Holding Group.

Growth rates have varied across the Chinese manufacturers. BYD recorded an 82% annual increase in wholesale deliveries, while Geely's wholesale shipments increased by 861% over the same period.

Automotive exhibitions have also contributed to sales activity. Jongkie Sugiarto, Chairman of Market Development at Gaikindo, said last month that major industry exhibitions had increased showroom traffic and accelerated purchasing decisions.

"The staging of the Gaikindo Indonesia International Auto Show (GIIAS) 2026 served as a primary driver behind the uptick in sales late last month, although confirmed transaction totals from the exhibition floor remain subject to final audits from authorised brand distributors (APMs)," Sugiarto said.

Following GIIAS 2026, Chinese manufacturers increased their new energy vehicle launches, expanding their model ranges from entry-level electric hatchbacks to premium plug-in hybrid multi-purpose vehicles (MPVs).

Competition is expected to increase further, with three additional Chinese brands beginning formal sales operations in Indonesia within the past month. Geely-backed electric vehicle manufacturer Zeekr and Stellantis-partnered Leapmotor made their Indonesian debuts at GIIAS 2026, followed last week by the formal market entry of premium state-owned brand Hongqi.