ION Mobility Gets Initial Funding, Next Year Will Launch Smart Electric Motorcycles in Indonesia

ION Mobility today (16/10) announced the acquisition of initial funding of $3,3 million or the equivalent of 48,6 billion Rupiah. The investors included in this round include Monk's Hill Ventures, TNB Aura, Village Global, 500 Startups (via fund 500 Durians), AngelCentral, kipleX, and Seeds Capital.

Basically ION Mobility is a smart electric motor development company. Smart here because they've embedded artificial intelligence software for multiple tasks, such as power saving and ease of use. The company is based in Singapore, Shenzhen (China), and Jakarta.

ION Mobility Co-Founder & CEO James Chan said, the product targets the Southeast Asian market. "There is no electric vehicle brand that excels in Southeast Asia [..] We are committed to offering a better alternative, namely a new generation of electric motors, smart and environmentally friendly, at an affordable price."

The release also stated that the market share of the motorcycle industry in Southeast Asia will reach $8,53 billion by 2023 - the third largest market for motorcycles in the world after India and China. In Indonesia alone, according to BPS data at the end of 2018, the number of motorcycles in circulation (officially) reached 137,7 units. The Indonesian Motorcycle Industry Association recorded sales of 6,05 million units in 2019.

ION Mobility plans to launch its first product in Indonesia in 2021. Through the funding obtained, they are committed to expanding their operations in the three regional bases that have been sheltered; including developing research capabilities and building partnerships for production and supply chains.

In Tanai Air, there are actually several electric motor products. Some of them are Viar, Elvindo Rama, Selis E-Max, Honda PCX, and a local manufacturer whose motorbike the president had tried, namely Gesits.

Reviewing regulations

On one occasion, the Minister of Industry Agus Gumiwang Kartasasmita says, in The roadmap The government's motor vehicle industry development targets production to grow to 10 million units by 2025, with an export target of at least 1 million units. In terms of production and sales of national motorcycles from 2010 to 2018 it has reached an average of more than 6,5 million units per year.

The Indonesian government also targets that around 20% of the total national production that year will be electric motors. "To realize this target, we aggressively invite automotive manufacturers to open production activities in Indonesia. The government believes that Indonesia has many advantages in the automotive sector, so that the 2030 target is not impossible to achieve," he explained.

Regarding the regulation, there is already a Presidential Regulation Number 55 of 2019 concerning the Acceleration of the Battery-Based Electric Motor Vehicle Program. Mandate the regulation of the use of the Domestic Component Level (TKDN) for Battery-Based Electric Motor Vehicles (KBL), including electric motorcycles, in order to increase the added value of the domestic industry.

In line with that, the government has also issued Government Regulation No. 45 of 2019, one of which regulates super tax deduction for research, innovation and vocational activities that can be given a reduction in gross income of up to 200%-300%.

Market readiness

According to a survey that held by Pertamina Energy InstituteOn the consumer side, people still doubt electric vehicles. For example, fear that when you are on the road you will run out of power. The reason is quite reasonable, because the supporting infrastructure for electric vehicles in Indonesia is still very minimal.

In addition, generally electric-powered vehicles are much more expensive than fuel-powered vehicles. From the research, it is stated that the average car is 3 times more expensive and for motorbikes it is 1,5 times more expensive.

Director General of Ilmate at the Ministry of Industry, Taufiek Bawazier, said the government did not deny the fact of the doubt. Currently, efforts are being made to eliminate local taxes for electric-powered vehicles. For the procurement of charging stations themselves, it is estimated that it will cost up to IDR 54,6 trillion per 31 thousand points -- the overall realization target by 2030. Indeed, the vision of electric vehicles must be supported by a strong ecosystem.

Collaboration with private players is also being encouraged to accelerate the development of this ecosystem. One of them with Grab, late last year the company ride hailing it announced electric vehicle trial four and two wheels in Jabodetabek. Grab will take advantage of a partnership with one of its investors, Hyundai as a car manufacturer through local entities, Hyundai Motor Manufacturing Indonesia, Astra Honda Motor (AHM), and Gesits for four wheels.

PLN is the appointed SOE to accelerate PP 55-2019, including the procurement of charging stations. Grab is one of 20 selected partners. Some others are Gojek, BlueBird, Transjakarta, Mobil Anak Bangsa, Build Your Dream (BYD) as transportation providers.