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Indonesia wants American electric car maker Tesla to make not just its batteries, but also its cars in the country, according to a Bloomberg report.
“What we want is the electric car, not the battery. For Tesla, we want them to build electric cars in Indonesia, [and] we want a huge ecosystem of electric cars,” president of Indonesia Joko Widodo said in an interview with the news outlet last week.
Widodo, more popularly known as Jokowi, had similar expectations from other automakers such as Ford, Toyota and Suzuki, according to Bloomberg, which the publication says is a signal of intent to seek investment to ensure that Indonesia is not left behind and relegated to being merely a supplier of raw materials or as a component maker in the wider, global electric vehicle supply chain.
Talks with Tesla are still ongoing, the Indonesian president told Bloomberg when asked what is holding back a deal with the EV maker. Everything needs time. I don’t want to be quick with no result; it needs intense communication and the result will show,” he said.
Here’s a bit of background on the Tesla-Indonesia courtship – Tesla had initially put forth an investment proposal to Indonesia in the first quarter of last year, which itself followed talks between the American EV maker and the Indonesian government in November 2020. Plans for the Tesla factory fell through in March this year, before talks resumed the following month.
In May, head of the Indonesian investment coordinating board and minster of investment Bahlil Lahadalia reportedly said that Tesla had agreed to construct a battery and EV factory at an industrial complex in Central Java, and subsequently the country was reported to have proposed the Batang regency for Tesla’s EV plant that is slated to have an annual capacity of 500,000 units.
In the wider scope of courting investment in EV and battery manufacture, Indonesia has been actively growing its presence, signing a partnership with Taiwanese electronics manufacturer Foxconn in January for the manufacture of batteries as well as vehicles.
Meanwhile, minister of investment Bahlil Lahadalia revealed last October that a proposal has been made to Volkswagen for the setting up of EV battery parts production in Indonesia, while the construction of Hyundai and LG battery plants commenced in September 2021 to be operational in 2024.
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