Tesla apparently considering battery and electric car factory in Indonesia

Tesla apparently considering battery and electric car factory in Indonesia

Indonesia's investment minister, Bahlil Lahadalia, says he is confident Tesla will make investments in the country. Media reports indicate that Elon Musk has agreed to build a plant at the industrial complex in Central Java province after meeting with Indonesia's President Joko Widodo.

While a concrete agreement has not yet been signed, the investment minister hinted that the project could begin this year. No details were disclosed about the amount of potential investment.

Musk and Widodo met during a visit by the Indonesian president to the SpaceX Starbase in the US state of Texas, where they reportedly discussed investment, as well as technology and innovation in general. After the meeting, the president reportedly instructed the coordinating minister for maritime affairs and investment, Luhut Binsar Pandjaitan, to follow up on the meeting's discussion. Musk has agreed to communicate intensively with the Indonesian team, Lahadalia said, adding that he expects an agreement to be reached soon.

"The team is negotiating, but rest assured that the president has a special move to woo Elon Musk," Lahadalia said later, according to the Jakarta Globe. "We're discussing how much the investment is worth and when to start. We just have to wait for the right time."

Indonesia is one of the most important nickel producers (around a quarter of global deposits are located there) and wants to build up a processing industry based on this - with batteries and electric cars. In recent years, international manufacturers have repeatedly been lured for this purpose.

For example, a Korean consortium led by LG has reportedly signed an agreement with Indonesian state-owned enterprises for a project worth around US$9 billion, which reportedly aims to build a complete value chain for electric vehicle batteries.

A similar partnership had already been concluded shortly before by the Chinese battery cell manufacturer CATL. In the course of this, CATL intends to invest the equivalent of almost 5.5 billion euros in the country. The project focuses on the areas of nickel mining and processing, battery materials, battery production and battery recycling.

In September last year, Hyundai Motor Group and LG Energy Solution broke ground on their battery cell factory in Indonesia, which was announced in late July. The plant, located in Karawang near the capital Jakarta, is expected to start production in the first half of 2024 with an annual capacity of 10 GWh.