Tesla, BYD finalizing deals to invest in Indonesia EV space

Tesla Inc. as well as Chinese automaker BYD and South Korea’s Hyundai Motor Co. are finalizing deals to invest in Indonesia’s electric-vehicle industry, said a senior minister.

“All the top global carmakers are coming to us,” said Luhut Panjaitan, coordinating minister for maritime affairs and investment, in a meeting with local government leaders on Tuesday. “BYD, Tesla, Hyundai and others are all finalizing deals with Indonesia.”

President Joko Widodo has set out a vision of building out an end-to-end electric-vehicle supply chain onshore by offering potential investors access to Indonesia’s reserves of key battery metals as well as its more than 270 million consumers. That plan is starting to take shape as global EV and battery producers plan billions of dollars of investment, from Contemporary Amperex Technology Co. Ltd.’s $6 billion mining-to-batteries complex to Hyundai’s new EV plant.

Bloomberg previously reported that Tesla was closing in on a preliminary deal to set up a factory in Indonesia.

Southeast Asia’s largest economy expects $30 billion of investments through 2026 to develop its EV battery ecosystem, according to a Tuesday presentation by Panjaitan. The government is also planning to give as much as 80 million rupiah ($5,271) of subsidy for each EV purchase to boost adoption, although the details are still under discussion

The cabinet has reached a decision on EV matters and will make an announcement soon, Panjaitan said on Tuesday, without specifying whether he’s referring to the foreign investment deals or the subsidy. –BLOOMBERG