Novy Lumanauw – President Susilo Bambang Yudhoyono sought on Thursday to reinforce the merit of his administration's policy to boost sales of low-cost green cars in Indonesia in response to criticism that the boom in cheap vehicles would hasten the capital's road to gridlock, and worsen traffic in other urbanized parts of the archipelago.
"From what I heard outside, there has been bias and distortion of what I said in the past," the president said prior to a cabinet meeting at his office. "The cheap-car policy was meant for village transportation... It is expected to be environmentally friendly because of electrical or hybrid [cars]."
The president's remarks came after 99 percent of the members of the Regional Representative Council (DPD) signed a letter calling on the head of state to explain further his reasoning behind a policy that many, including the Jakarta governor, have said will bring the capital to a standstill.
"The policy is contrary to the Jakarta administration's efforts to accelerate the management of traffic congestion in the city," Jakarta Governor Joko Widodo said in a letter to Vice President Boediono in September. "We are currently speeding up the preparation of the facilities and infrastructure to reduce the traffic and then suddenly there is this cheap car policy."
A recent World Bank report indicated that Jakarta could face total gridlock as early as 2014. Progress on mass-transit systems has been delayed for decades as funding impasses and protectionist legislation scared away or forced out foreign consortia. Ground has officially broken on a monorail and MRT for Jakarta, but neither will be operational before 2016 – and few Jakartans would be surprised if both projects overshot their respective deadlines of 2016 and 2017.
Car manufacturers have responded to the demands of the market in Indonesia by releasing new models that can be rolled off production lines at very little cost. Models such as the upcoming Suzuki Karimun Wagon, for example, can be bought for as little as Rp 77 million ($6,600).
Joko on Thursday said that there were 1.2 million new vehicles registered in Jakarta so far in 2013 – 944,000 motorcycles and 273,000 new cars. The 1.2 million new vehicles does not include new cars and motorcycles in Jakarta's satellite cities – Bekasi, Bogor, Depok and Tangerang – many of which will be used to commute into and out of the center of town.
Nationwide car sales in the first 10 months of the year stood at 1,020,389 units, new data from the Indonesian Association of Motorized Vehicles (Gaikindo) showed on Friday. In October alone, 112,038 units were sold – slightly down on the 115,975 units sold in September.
Toyota Astra Motor topped the list of sales in October with 39,246 cars, followed by Astra Daihatsu Motor with 20,445 units and Mitsubishi with 15,216.
Joko has said that he plans to propose a more robust progressive car tax to the Jakarta Legislative Council to impede new vehicle sales. Currently, second cars are taxed at 2 percent of the value of the sale, but the governor plans to increase this to 4 percent, up to a maximum of 8 percent for the fourth car a person owns.
The political standoff between City Hall and the State Palace is instructive of the distinct challenges to raising living standards in urban and rural areas of Indonesia.
The Global Status Report on Road Safety 2013 by the World Health Organisation (WHO) said that there were 31,234 road deaths in Indonesia in 2010, although the organization conceded that the margin for error meant the real figure could be as high as 47,673.
Motorcycle deaths accounted for 36 percent of deaths on the road, while car drivers and passengers made up 6 percent of the total.
The increased safety and comfort of upgrading to a car from a motorcycle, combined with an environment of easy credit, means that observers expect that any drive to reduce emissions by incentivizing consumers to switch to low-cost green cars will be drowned out by people upgrading from motorcycles. The government says it has a responsibility to protect road users in the vast swathes of the country where development, not traffic, carries the sense of urgency.
"The transportation ministry expects people to shift from cars with higher engine capacity to cars with lower engine capacity," Indonesia Transport Society (MTI) chairman Danang Parikesit said in September. "But our estimates show that it is the motorcycle owners who will purchase these cheaper cars."
The president, by contrast, has traveled to India to study the effectiveness of rural transportation using electric cars and has by all accounts remained convinced that emissions can be lowered and living standards raised by creating a framework where people can buy cars for less.
The difference of opinion between Joko and Yudhoyono has its roots in Indonesia's highly decentralized political system, and the president has pointed to individual governors' responsibilities to manage the issue of traffic in their respective constituencies while the executive branch works to improve the lot of the Indonesian people as a whole.
"I don't enjoy being asked for a solution [to traffic] in Jakarta, Bandung, Surabaya and other places," the president said earlier this month. "It is the governors and mayors that are in charge of providing an explanation."
Joko, however, feels that his hands have been tied by the State Palace – and that there is no easy solution in sight. "We were asked to manage the transportation, ease the traffic and build infrastructure," Joko said as quoted by Tempo.co. on Thursday. "But we're being attacked by cheap cars, so we want to question this."