Hyundai opens EV battery plant in Indonesia with eye on wider region

Industry

Published: 03 Jul. 2024, 16:07

Hyundai opens EV battery plant in Indonesia with eye on wider region

Indonesian President Joko Widodo autographs a Kona Electric at an event celebrating Hyundai Motor's completion of an EV battery plant in Karawang, Indonesia, on Wednesday. [HYUNDAI MOTOR]

Hyundai Motor completed construction of a $1.1 billion EV battery plant in Indonesia, the largest EV battery factory in Southeast Asia.

The Korean automaker is slated to launch a locally manufactured Kona Electric SUV in the market on July 17, powered by batteries from the new facility.

The plant in the regency of Karawang is a joint venture with LG Energy Solution that has an annual production capacity of 10 gigawatt-hours, or enough for approximately 150,000 EVs. The factory will make NCMA lithium-ion cells, which use nickel, cobalt, manganese and aluminum.

The batteries will be shipped to Hyundai's manufacturing plant in Bekasi in West Java to power various Hyundai and Kia vehicles.

Hyundai Motor Group Chairman Euisun Chung speaks during an event celebrating the company's completion of an EV battery plant in Karawang, Indonesia, on Wednesday. [HYUNDAI MOTOR]

A joint battery plant by Hyundai Motor and LG Energy Solution in Karawang Regency, Indonesia, 65 kilometers southeast of the capital of Jakarta. [HYUNDAI MOTOR]

"Cars produced in Indonesia present a new standard to potential customers in Southeast Asia, and the vitalization of Indonesia's EV industry will offer new economic opportunities to the entire continent," Hyundai Motor Group Executive Chair Euisun Chung said during a ceremony held at the plant Wednesday, which was attended by Indonesian President Joko Widodo.

Hyundai is the No. 1 EV maker in the country, with a total of 7,475 EVs sold there last year accounting for 44 percent of the market.

The Kona Electric will be the second EV manufactured in Indonesia after Hyundai's Ioniq 5, which is also produced at the plant.

A Kona Electric SUV is produced at Hyundai's plant in Bekasi in West Java with locally made batteries. [HYUNDAI MOTOR]

A Kona Electric SUV is being produced at Hyundai's plant in Bekasi in West Java with locally made batteries. [HYUNDAI MOTOR]

Indonesia, the fourth most populous country in the world, is the richest in terms of natural resources essential in EV battery-making. It has the largest nickel reserves, estimated at 21 million tons, around 22 percent of the global total, according to U.S. Geological Survey data.

The Southeast Asian country has been trying to switch to EVs. Under an ambitious goal of achieving carbon neutrality in 2060, its government has been attracting EV-related investment by offering generous incentives and tax exemptions.

"Young Indonesian consumers accept new technologies well, while the government has strong determination with EVs," Chung said. "Based on Indonesia, Hyundai seeks chances to enter other Southeast Asian countries."

BY SARAH CHEA [chea.sarah@joongang.co.kr]