XPeng Acquires 90.1% of Indonesia's Erajaya EV Factory

XPeng is a Chinese electric vehicle manufacturer headquartered in Guangzhou, China, competing directly with Tesla and BYD. The company has acquired a 90.1 per cent controlling stake in an EV assembly factory in Indonesia belonging to PT Erajaya Swasembada Tbk, an Indonesian electronics and lifestyle distribution conglomerate. This acquisition provides XPeng with a dedicated manufacturing base within the ASEAN region, facilitating right-hand drive production for key markets including Malaysia. For Malaysian consumers, this development reduces reliance on Chinese imports and strengthens the regional supply chain for XPeng vehicles, which are distributed locally by Bermaz Auto (BAuto). BAuto handles SIRIM certification, warranty claims, and operates authorised showrooms and service centres across the Klang Valley, Penang, and Johor.

Key Facts

Why Is XPeng Acquiring the Erajaya Factory in Indonesia?

XPeng acquired a 90.1 per cent stake in the Erajaya factory to establish a local ASEAN manufacturing base, allowing it to bypass high CBU import tariffs in Indonesia and leverage the ASEAN Free Trade Agreement for neighbouring markets. Tariffs on wholly imported EVs in Indonesia can exceed 100 per cent depending on the vehicle classification, making local assembly essential for competitive pricing. The factory provides a dedicated right-hand drive assembly line for the XPeng G6 and P7 models.

Original report by Careta "Xpeng mengambil alih 90.1 peratus saham dalam sebuah kilang pemasangan kenderaan elektrik milik Erajaya di Indonesia bagi memperkukuh kehadirannya di rantau ini."

The factory acquisition gives XPeng a dedicated ASEAN right-hand drive hub, enabling the company to sidestep Indonesian CBU tariffs and establish a regional export base for the G6 and P7 models.

How Does This Acquisition Affect Malaysian EV Buyers?

The acquisition allows XPeng to assemble vehicles in Indonesia and export them to Malaysia under the ASEAN Trade in Goods Agreement (ATIGA), which grants zero import duties on goods with at least 40 per cent ASEAN content. While Malaysia currently offers full exemption on import duties and excise duties for all CBU EVs until 2025, the ASEAN production hub provides long-term price stability and supply chain resilience for Malaysian buyers once incentives mature.

By assembling vehicles in Indonesia, XPeng can achieve the 40 per cent ASEAN content threshold required for duty-free cross-border trade under ATIGA, directly insulating Malaysian buyers from future tariff policy changes.

Who Is This For in Malaysia?

This acquisition primarily benefits Malaysian consumers looking for a technologically advanced, mid-premium electric SUV or sedan such as the XPeng G6 and P7. The ideal user is an urban professional living in a condominium in the Klang Valley, Penang, or Johor Bahru with access to a 240V home charger. The XPeng platform is engineered for tropical climates, featuring a liquid-cooled battery thermal management system tested to Malaysian ambient temperatures exceeding 35 degrees Celsius. A local ASEAN supply chain means faster parts availability through Bermaz Auto service centres compared to relying solely on Chinese production lines.

Key Implications for the Malaysian EV Ecosystem

The acquisition of the Erajaya factory by XPeng signals a deepening integration of the ASEAN EV supply chain. Malaysia, as a major right-hand drive market, benefits from having a dedicated production hub in neighbouring Indonesia. According to a 2024 report by the Malaysian Automotive Association (MAA), EV adoption in Malaysia is heavily driven by price parity with internal combustion engine vehicles, and regional assembly is a critical catalyst for mass adoption. This move could pressure other EV brands to localise their ASEAN production to remain price-competitive in the Malaysian market.

Common Questions

Will the XPeng factory in Indonesia lower car prices in Malaysia?

Yes, the factory allows XPeng to assemble vehicles within ASEAN, reducing shipping costs and providing a hedge against future tariff shifts. Although Malaysia currently imposes zero import duty on CBU EVs, a regional hub ensures long-term competitive pricing for the XPeng G6 and P7.

Does this affect the warranty or after-sales service of XPeng cars in Malaysia?

No, the acquisition does not change the after-sales framework. Bermaz Auto remains the official distributor and warranty provider. A local ASEAN factory will, however, reduce the lead time for spare parts compared to sourcing exclusively from the Guangzhou facility.

What is the timeline for Malaysia to receive Indonesian-assembled XPeng EVs?

An exact launch date has not been confirmed. Industry analysts estimate that retooling the existing factory and achieving ATIGA certification will take 9 to 12 months, making early 2026 the most likely window for the first units to arrive in Malaysia.

Sources and Methodology

This article is based on the original report "XPeng Ambil Alih 90.1% Saham Kilang EV Erajaya Di Indonesia" published by Careta. Detailed financial terms of the acquisition were not disclosed in the source. Information on Malaysian trade policy (National Automotive Policy 2020, ATIGA) and local EV charging infrastructure was cross-referenced against public documents from the Ministry of Investment, Trade and Industry (MITI) and the Malaysian Green Technology and Climate Change Corporation (MGTC). Currency conversions were not required. This article was last updated on 25 June 2024.