Maybank Investment Bank said Wednesday that Indonesia’s new logistics rules to benefit third-party logistic providers.

The research house said in a note that it believes the regulation will benefit third-party logistics and instant delivery companies.

“In the listed space, we think Antar Aja (3PL), and instant delivery Go-Send (GoTo’s services) and Grab Express will be beneficiaries,” it said.

Meanwhile, it said the push towards green logistics will boost demand for electric fleets, including electric motorcycles and trucks.

On the other hand, the regulation will impact in-house logistics operators as they must follow market prices and compete fairly, while competitors can share networks leading to greater efficiency, it added.

Indonesia’s government issued new regulations in an effort to encourage the logistics business (including e-commerce logistics) to be more efficient though infrastructure sharing and environmentally friendly operations (green logistics).

It also plans to monitor the industry in an effort to ensure fair competition.

Maybank also viewed that in-house e-commerce logistics delivery operators will suffer under the new regulations because economies of scale are at risk (due to limited promotional time); competitors become more efficient due to network alliances (sharing infrastructure: drop points, fleets, warehouse, and backbone platforms) – leading to better pricing; and risk of anti-monopoly breaches as the government can monitor delivery volumes.

“We think the government might implement a floor and ceiling price policy to encourage healthy competition (based on the practice of transportation fare regulations),” it said.

Moreover, it noted the government might review the logistics company’s financials, including unit costs to measure the industry’s cost structures.

“We think that Shopee Indonesia and SPX Express might be negatively affected by this regulation, and that changes in delivery charges could impact consumers’ e-commerce purchase decisions,” it added.

The Ministry of Communication and Digital (Komdigi) issued a new regulation, with the key points of Indonesia targets industry collaboration with the aim of serving 50 percent of the nation’s provinces within 18 months; higher service standards and consumer protection; infrastructure sharing, fair competition, and green logistics.

Based on media reports, the government is aiming to achieve consolidation among logistics companies, targeting 20 players.

Local media also reported that the government will regulate free shipping or predatory pricing (lower than regular shipping costs) to three days per month.

Ecommerce companies can request time extensions, but Komdigi will review such requests.


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