Singapore’s ION Mobility to invest US$15 million in Indonesia electric vehicle market

[JAKARTA] Ion Mobility, a Singapore-based electric vehicle (EV) startup, will invest US$15 million over the next three years to expand its presence in Indonesia, its founder and chief executive officer James Chan told The Business Times.

The company and its strategic investor TVS Motor Company – the third-largest motorcycle company in India in terms of revenue – will deepen their collaboration to develop electric sports scooters.

This collaboration, called Project Dynamo, was announced at this week’s Indonesia Motorcycle Show that takes place in Tangerang – a satellite city of the capital Jakarta – from Wednesday (Oct 25) to Sunday.

Ion Mobility said there is demand from Indonesian riders who are looking for performance and speed when buying electric two-wheelers that are efficient and environmentally friendly.

The four-year-old company’s latest investment in Indonesia comes eight months after Ion Mobility’s last fundraising round of US$18.7 million, which brought its total to more than US$25.5 million.

TVS Motor came on board as a strategic investor in that last Series A funding round.

Among the other investors were AC Ventures Malaysia, businessman Michael Sampoerna (from one of the richest families in Indonesia), Seeds Capital (the investment arm of Enterprise Singapore) and Monk’s Hill Ventures.

In the interview with BT, Chan said Ion Mobility’s partnership with TVS Motor is to support the former’s vision to build South-east Asia’s leading electric mobility solutions company, starting with Indonesia.

“Electric motorcycles and scooters are just the beginning. There’s a lot to learn from TVS and its strong commitment to electric mobility, in terms of what we can do for motorcycle riders in the region,” he said.

Ion Mobility is currently building an electric motorcycle manufacturing plant in West Java, which is located near TVS Motor’s facility in Indonesia.

Chan said the new factory is on track to begin operations by the end of this year and is expected to create more than 300 jobs.

The production capacity is up to 50,000 units per year, and the first batch is slated for delivery some time in the first quarter of 2024.

In November 2022, at the previous Indonesia Motorcycle Show, Ion Mobility launched its first electric smart motorcycle, called the M1-S. Production is already under way, and Chan said that pre-orders are in the “significant three-figures”, without giving the exact number.

Indonesia is one of the world’s largest motorcycle markets.

There are some 125.3 million two-wheelers on the roads as at December 2022 – much higher than the 17.2 million four-wheelers that are in use, according to data from Statistics Indonesia.

Manufacturers from Japan dominate Indonesia’s motorcycle industry, with Honda the frontrunner with a market share of more than 68 per cent. EV motorcycles account for just 0.2 per cent of Indonesia’s total motorcycle sales, although analysts expect this to rise sharply in the coming years as more players enter the market.

Apart from manufacturing motorcycles, Ion Mobility is also working with Indonesian state-owned company PLN to install up to 100 co-branded charging stations across Jakarta. This network could be expanded nationwide depending on the market’s needs, said Chan.

Strategic move

TVS Motor launched its first electric motorcycle, the iQube, in 2020 in India, and close to 25,000 units are sold every month, said the president of group strategy Sharad Mohan Mishra.

Apart from EVs, the company has also sold a combined 3.9 million units of petrol two-wheelers and three-wheelers in 80 countries, with Indonesia being TVS’ third biggest market after India and China.

“We have invested in electrification technology and capital development for almost a decade now. Indonesia is a very natural market for us, from an electrification point of view,” said Sharad, who is based out of Singapore.

He added that TVS is also expanding its partnership with other EV original equipment manufacturers, including those in India and Latin America, as part of this electrification expansion.

“We believe that electrification is the natural journey that every two-wheeler industry will take too. We are trying to be better prepared to service that market, using this platform,” he said.