Hyundai to produce e-vehicles at Indonesian plant

South Korean car-maker Hyundai Motor Company was set to produce electric vehicles (EV) in Indonesia by 2022 as the country plans to manufacture batteries for such vehicles.

Hyundai Motor Asia Pacific vice president Lee Kang Hyun was quoted as saying in a report by Jakarta Post that the company would begin production of EVs would be produced at its first manufacturing plant in Southeast Asia.

It can be recalled that Hyundai signed a memorandum of understanding with the Indonesian government last year for the construction of the production plant which will sit on a 77.6-hectare landbank in Delta Mas, Cikarang, West Java. As of press time, the facility was 65% complete.

Hyundai was to set aside as much as $1.55 billion through 2030 for the development, operations, and management of the facility.

Lee said that the factory would begin producing cars by the end of next year with a projected capacity of 150,000 cars by the second half of 2021. It would initially produce compact sport utility vehicles and sedans, and then hybrid vehicles thereafter.

The company said it was targeting to manufacture 250,000 vehicles when it becomes fully operational.

“With the support of the ministries and the local government, the factory’s construction is 65-percent done despite the COVID-10 (coronavirus disease-2019) pandemic,” Lee was quoted as telling a news briefing at the 2020 West Java Investment Summit in Bandung on Monday.

Indonesia was looking to take advantage of its being the largest nickel producer in the world by manufacturing lithium batteries and eventually, electric cars.

According to reports, the government was in talks with China’s largest EV battery maker CATL and South Korea’s LG Chem to build an end-to-end supply chain for EV batteries.

Investment Coordinating Board chief Bahlil Lahadalia said in a virtual seminar that CATL officially inked an agreement to invest $5.1 billion in Indonesia.

Under the Widodo administration, Indonesia was expected to begin the local production of EVs by 2021 or 2022 with a target of 200,000 electric cars exported by 2025.

Likewise, Indonesia was one of the largest markets in terms of car penetration, having sold 1.03 million cars in 2019.

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