Jakarta. Indonesia is expecting more wallet-friendly German cars once the European trade deal takes effect early next year, as tariffs on automobiles will be close to 0%, according to a senior minister. 

Southeast Asia’s biggest economy is now working on getting its trade deal with the European Union (EU) in motion.

As the document awaits the final touches and lawmaking processes, Jakarta has got its heart set on having the pact — dubbed CEPA for Comprehensive Economic Partnership Agreement — take effect in January 2027.

Chief Economic Minister Airlangga Hartarto expressed hope that German cars can enter the Indonesian market at “competitive prices” once the deal is in place.

“With the CEPA, the tariffs [on cars] will be close to 0%,” Airlangga told reporters at the German Unity Day reception in Jakarta on Friday night.

He also admitted to wanting to see the “famous [German] people’s car [be sold] at an affordable price [here]”, alluding to the German auto powerhouse Volkswagen. 

Cars stuck in traffic jams are common in Indonesia's major cities. However, most of them are Japanese brands, with Chinese and South Korean four-wheelers increasingly gaining popularity. German Ambassador to Indonesia Ralf Beste admitted he wanted to see more of his country’s cars on Indonesian roads.

“[Our cars] are very modern, high-tech, and long-lasting. Thanks to the CEPA, German companies have better access to the growing Indonesian market. That will make us both more prosperous," Beste said.

Indonesia reported that its trade with Germany fell by 7% year-on-year (yoy) to nearly $3.9 billion in January-August 2026. The country’s imports of German vehicles shrunk to $65.8 million over the same period, down by almost 63% yoy, Trade Ministry data showed.

The CEPA will have Indonesia and the EU eliminate tariffs on over 98% of tariff lines, and nearly 100% in terms of value.

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