- The electric car produced by Elon Musk, Tesla, is said to be investing in Indonesia this year.
- According to the Head of the Investment Coordinating Board, Central Java will become the center of the best industrial area in Indonesia, namely Batang.
- The government is ready to facilitate investors to process permits if they want to invest in Indonesia.
Electric vehicles companies are interested in investing and building factories in Indonesia. The electric car produced by Elon Musk, Tesla is said to be investing in Indonesia this year. According to the Head of the Investment Coordinating Board, Tesla’s investment will be made in the Batang Integrated Industrial Estate, Central Java. And Batang government has also confirmed that the location for the construction of Tesla’s electric car factory in Indonesia has been confirmed. Later, this electric vehicle factory will be built in the Batang Integrated Industrial Estate.
According to the Head of the Investment Coordinating Board, Batang will become the center of the best industrial area in Indonesia. The government has been preparing Batang as an electric vehicle battery development area for the past few years.
The 4,300 ha industrial area is an integrated industry between electric batteries and electric car factories with a number of advantages, such as being close to the toll road and the city of Semarang, as well as being close to the port for export.
Read more:
Besides Tesla, in the Batang integrated industrial area there will also be large companies, such as LG, Foxconn. And then Tesla will get in there too, and a few other companies including a glass factory whose construction has already started.
Several electric vehicle companies are very interested in investing in Indonesia. This is because Indonesia has prepared a comprehensive electric car battery ecosystem from upstream to downstream. Those are from mines, smelters, precursors, battery cells, to recycling.
In addition, Indonesia also has extraordinary natural resources to build an electric battery industry. To make an electric car battery requires four components, nickel, cobalt, manganese and lithium. And Indonesia has nickel reserves of 25% of the world’s reserves. However, only lithium is not owned by Indonesia. Furthermore, production costs in Indonesia are much cheaper than other locations in the world. Even, the government is ready to facilitate investors to process permits if they want to invest in Indonesia.
The following is a list of electric battery companies that have invested in the electric vehicle ecosystem business in Indonesia.
1. LG Chem
LG invested US$ 9.8 billion or around Rp. 144.4 trillion to build an integrated electric battery industry in Indonesia. It’s starting from mining, smelting, refining, as well as precursor and cathode industries, as well as cell battery.
According to the Head of the Investment Coordinating Board, LG’s investment is the largest since the reform era began. This South Korean company will build a precursor and cathode industry in the Batang integrated industrial area. And through its subsidiary, LG Energy Solutions built a battery cell factory in Karawang, West Java.
In building the battery cell factory, LG is part of a consortium consisting of the Hyundai Motor Company, KIA Corporation, and Hyundai Mobis. In addition, it also cooperates with Indonesia Battery Corporation, by forming a joint venture company PT HKML Battery Indonesia. And this battery cell factory was built at a cost of US$ 1.1 billion or around Rp 16 trillion. It will generated production capacity of 10 gigawatt hours (GWh), and will be gradually increased to 30 GWh. And then, the battery cells produced at this factory will later supply electric vehicles made by Hyundai.
2. Contemporary Amperex Technology Co., Limited (CATL)
Electric battery manufacturer from China, CATL will cooperate with PT Aneka Tambang Tbk (Antam) and PT Indonesia Battery Corporation (IBC). This was done in developing the battery integration project for Indonesian electric vehicles.
The projects include nickel mining and processing, electric vehicle battery materials, electric vehicle battery manufacturing, and battery recycling. So, the combined investment value for the project reached US$ 5.97 billion or equivalent to Rp 85.8 trillion. In this project, Antam and IBC will cooperate with CATL’s grandson, Ningbo Contemporary Brunp Lygend CO., Ltd (CBL). It is a subsidiary of Brunp Recycling Technology Co., Ltd. Brunp is a subsidiary of CATL. And CATL is the world’s largest electric vehicle battery manufacturer, offering its products to a number of car brands including BMW, Volkswagen and Tesla.
3. Huayou Cobalt
A Chinese company, Zhejiang Huayou Cobalt Co. is interested in investing in building a nickel and cobalt smelter in Indonesia worth US$ 2.08 billion or around Rp. 30 trillion. Next, the company will partner with electric vehicle battery manufacturer, also from China, EVE Energy.
Huayou will form a joint venture company called PT Huayu Nickel Cobalt, with a 20% stake, while EVE will own 17% stake. Other partners are Yongrui Holdings (31%), Glaucous International Pte Ltd (30%), and Lindo Investment Pte Ltd (2%). So, this will be the nickel smelting project for Huayou’s third electric battery in Indonesia. Previously, Huayou had partnered with Tsingshan Holding Group to build a nickel sulfate smelter, which is planned to be located in Weda Bay, Halmahera, North Maluku. Based on Huayou’s report to the Shanghai Stock Exchange, the company targets to produce 120,000 tons of nickel and 15,000 tons of cobalt annually.
Read more:
4. BASF, VW, British volt
The Head of the Investment Coordinating Board provided information regarding a number of names that have officially invested in the sector, including BASF, VW, Britishvolt. However, it has not been confirmed how much of the commitment value has been agreed and to what extent the agreement process is.
5. Foxconn
Foxconn together with Gogoro, IBC, and Indika Energy will explore cooperation in investing in a comprehensive electric vehicle ecosystem in Indonesia.Then, Investments made ranging from batteries to the development of the vehicle industry.
Furthermore, four companies have signed a cooperation commitment to build an electric vehicle ecosystem in Indonesia with a total investment value of US$ 8 billion or equivalent to Rp. 114 trillion. And this collaboration is related to investment in the development of a new sustainable energy ecosystem through investment in electric batteries, electric vehicles, and their supporting industries with the Build-Operate-Localize (BOL) cooperation scheme.
So through the memorandum of understanding, Foxconn will explore cooperation in investing in a comprehensive electric vehicle ecosystem in Indonesia. Starting from the manufacture of electric batteries (including battery cells, battery modules, and batteries), to the development of the four-wheel electric vehicle industry. Then, the scope of cooperation also includes the development of EV supporting industries which include energy storage systems (ESS), battery exchange/swap stations, recycled batteries, as well as research and development (R&D) in the field of electric batteries and EVs.
The entire project is expected to generate a total market capitalization of more than US$100 billion in Indonesia by 2030.
Editor: Riana Nurhasanah
References:
[1]Perusahaan Mobil Listrik Dunia Berlomba Bangun Pabrik di Batang
[2]Bupati Batang Pastikan Pabrik Mobil Listrik Tesla Dibangun di KITB
