A Strategic Analysis of the Bus Market, Indonesia, 2024-2035

Indonesia s Bus Sector Drives Transformational Growth through Bus Fleet Electrification to Reduce Emissions and Improve Sustainable Urban Transport and Energy Efficiency

Indonesia emerges as a significant player in the global bus market due to its expanding population and increasing reliance on public transportation. The number of buses in operation rises every year, with leading original equipment manufacturers (OEMs) such as Mercedes-Benz, Mitsubishi Fuso, Hino, Isuzu, and Scania dominating sales. The Indonesian bus market primarily operates on a chassis basis, where bus chassis are either imported as completely built units or assembled as completely knocked down kits, while local bodybuilding companies (Tentrem, Adiputro, Trisakti, Laksana) fabricate the bus bodies. This Frost & Sullivan analysis covers the market dynamics and the role of these key manufacturers in Indonesia's bus industry.

Frost & Sullivan estimates that the market will grow at a 1.44% compound annual growth rate (CAGR), with a notable shift toward battery electric buses (BEBs) driven by government initiatives to reduce greenhouse gas emissions. The Indonesian Ministry of Transportation has set ambitious targets, aiming for 90% of urban mass public transport to be electrified by 2030 and achieving 100% electrification by 2040. Furthermore, PT TransJakarta, Jakarta's public fleet operator, plans to replace its entire fleet of internal combustion engine buses with 10,000 BEBs by 2030. To facilitate this transition, the government actively promotes local manufacturing. Companies such as PT INKA and PT MAB lead the way, achieving 75% and 35% localization in their production processes, respectively. This analysis covers these electrification targets and efforts to promote local manufacturing.

In addition to electrification, there is a growing emphasis on enhancing safety for drivers and passengers, leading to an expected increase in advanced driver assistance systems (ADAS) adoption. The shift toward sustainable electric mobility and improved safety features positions Indonesia's bus market for a transformative future. The government's proactive approach, combined with the rising demand for efficient public transportation, establishes Indonesia as a key player in the global bus industry. This analysis covers the innovative solutions that address the country's transportation needs while prioritizing environmental sustainability and passenger safety.