JAKARTA : South Korean conglomerate LG is poised to significantly expand its footprint in Indonesia’s electric vehicle (EV) supply chain, with plans to invest an additional $1.7 billion in a battery cell manufacturing joint venture, according to the country’s Investment Ministry.
The anticipated investment will be directed towards HLI Green Power, a collaboration between LG Energy Solution, Hyundai Motor Group, and Indonesia Battery Corporation (IBC). The project’s first phase, located in Karawang, West Java, commenced operations last year with an investment of $1.1 billion.
Rosan Roeslani, Indonesia’s Investment Minister, revealed that discussions with LG have advanced positively, raising expectations for the second phase of the plant’s development. “I will be visiting the Karawang facility tomorrow, as LG has initiated conversations with us regarding their interest in investing a further $1.7 billion,” Rosan said during a press briefing in Jakarta. “We are confident this additional investment will materialise promptly.”
The planned injection would bring the total value of the battery cell joint venture to approximately $2.8 billion. The second phase is expected to double the plant’s production capacity from 10 gigawatt-hours (GWh) to 20 GWh annually—sufficient to power up to 300,000 electric vehicles.
LG’s renewed investment signals a measured commitment to Indonesia’s EV ambitions despite the group’s recent withdrawal from a broader, multibillion-dollar battery supply chain project in the country, reportedly due to unfavourable market conditions.
The Karawang facility was officially launched in July 2024 by then-President Joko Widodo, who described it as Southeast Asia’s first and largest EV battery cell plant. The plant’s first development phase was estimated at around $1 billion, with a planned output capacity of 10 GWh per year.
Indonesia attracted $13.7 billion (Rp 230.4 trillion) in foreign direct investment (FDI) in the first quarter of 2025, with South Korea contributing approximately $683.3 million. The East Asian nation ranks as Indonesia’s seventh-largest source of FDI for the period, just behind the United States.
–Jakarta Globe
