Minister of State-Owned Enterprises (SOEs), Erick Thohir, has revealed of the government’s plan to offer an investment project for the electric vehicle (EV) battery industry ecosystem after LG Energy Solution left the project.
A number of countries have been offered the project, which is located in East Halmahera, North Maluku. They include Saudi Arabia, the United Arab Emirates, Qatar, Japan and the United States.
Erick emphasized that the government is open to any investor who wants to fill the gap in LG Energy Solution.
"For example, we have offered Saudi Arabia to enter the project because it is building a vehicle ecosystem in its country," the SOEs Minister said on Tuesday, April 22, 2025.
Previously, LG Energy Solution was part of a consortium that collaborated with State-owned mining company PT Aneka Tambang to mine nickel to process it into EV batteries.
Erick gave a signal that investment in the project could be replaced by PT Daya Anagata Nusantara Investment Management Agency (BPI Danantara), while citing that Danantara has received an investment commitment worth US$2 billion (Rp34 trillion) from the Qatari government.
He said that there are still many foreign investors who are continuing their projects to produce EV batteries, including Volkswagen Group through PowerCo, Ningbo Contemporary Brun Lygend Co., Ltd (CBL) and Ford Motor.
"We are open to anyone who wants to replace LG's investment, as long as it supports the acceleration of the EV industry momentum," he noted.
EV market
Erick also claimed that the domestic EV market has surged based on sales results at a car exhibition dominated by electric cars.
Currently, the government is building charging stations to support EV operations by several parties, such as State power utility PT Perusahaan Listrik Negara (PLN) and PT VinFast Indonesia.
Data from the Association of Indonesian Automotive Industries (Gaikindo) shows that EV sales in 2023 was recorded at 43,193 units, up 153.21 percent compared to the previous year of 17,058 units. Therefore, Eric assessed that the growth trend of EV ownership in the country cannot be stopped.
He said that increasing sales and the construction of charging facilities would eventually trigger the establishment of an organic EV industry ecosystem.
"It's up to investors to invest according to their grand strategy. But I think the trend of EV consumption in the country cannot be stopped," he said.
However, Gaikindo suggested that the electric battery-based car industry ecosystem for EVs in Indonesia is not yet fully ready. It, therefore, emphasized the importance of careful planning in building an EV industry ecosystem.
Secretary General of Gaikindo, Kukuh Kumara assessed that the domestic automotive industry infrastructure, especially the parts supplier sector, is not yet ready to support EV production as a whole.
"The number of domestic car parts suppliers is still below 1,000 units, especially for EV parts. That is a challenge for EV factories in ensuring component availability," Kukuh said as quoted by Katadata.co.id on Tuesday, April 22, 2025.
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