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Volkswagen to partner on Indonesia EV battery ecosystem -minister
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JAKARTA (Reuters) – Volkswagen will build an electric vehicle (EV) battery ecosystem in Indonesia and will partner with miner Vale, Ford and China’s battery minerals producer Zhejiang Huayou Cobalt, the Southeast Asian country’s
JAKARTA (Reuters) – Volkswagen will build an electric vehicle (EV) battery ecosystem in Indonesia and will partner with miner Vale, Ford and China’s battery minerals producer Zhejiang Huayou Cobalt, the Southeast Asian country’s investment minister said.
Automakers are courting Indonesia for its raw materials used in producing EV batteries, which account for about 40% of a vehicle’s sticker price, aiming to cut costs and close the gap on EV market leader Tesla.
Minister Bahlil Lahadalia said on Sunday that Volkswagen, Europe’s biggest automaker, will work with Vale, Ford, Huayou, French miner Eramet and several Indonesian firms such as Merdeka Gold Copper, the parent company of Merdeka Battery, and energy firm Kalla Group.
The partnerships would consist of joint ventures and supply raw materials, he said in a video statement from Germany, where an Indonesian delegate led by President Joko Widodo was attending industry fair Hannover Messe and meeting representatives of companies including German chemical giant BASF, Eramet and Volkswagen.
Separately, a statement issued by Widodo’s office said Volkswagen’s investment will be carried out by its battery unit PowerCo.
Meanwhile, Bahlil said BASF had also expressed an interest in building a plant to produce battery materials, partnering with Eramet, in Indonesia’s north Maluku province, for a total investment of about $2.6 billion.
BASF did not immediately respond to a request for comment, but the company in January said details of its investment plan with Eramet would be announced once an assessment was concluded.
Bahlil said investment interest by European companies would allay concerns that Indonesia’s management of its mines “did not adhere to international standards.”
Widodo, who is widely known as Jokowi, told Reuters last month that Indonesia will improve monitoring of environmental standards for nickel mining, amid concerns over the impact of production of the metal.
Volkswagen, Ford, Eramet, Kalla Group, Huayou, and Merdeka Gold Copper did not immediately respond to requests for comment. PT Vale Indonesia declined to comment.
Indonesia, which has the world’s biggest nickel reserves, has been trying to develop downstream industries for the metal, ultimately aiming to produce batteries and EVs.
Last month, Ford inked its first investment in Indonesia by joining Vale Indonesia and Huayou in a $4.5 billion nickel processing plant in Southeast Sulawesi.
Volkswagen last month said it plans to invest 180 billion euros ($193 billion) over five years in areas including battery production and raw material sourcing.
(Reporting by Stanley Widianto; Additional reporting by Bernadette Christina and Siyi Liu in Beijing; Editing by Ed Davies)
An electric vehicle (EV) is a type of vehicle that is powered by electricity instead of traditional fossil fuels. EVs use electric motors and batteries to operate, offering a more sustainable alternative to conventional vehicles.
A battery ecosystem refers to the interconnected network of companies and technologies involved in the production, supply, and recycling of batteries, particularly for electric vehicles. It includes manufacturers, suppliers, and recycling firms.
Nickel is a key component in lithium-ion batteries used in electric vehicles. It enhances battery energy density, allowing for longer driving ranges and improved performance.
A joint venture is a business arrangement where two or more parties agree to collaborate on a specific project or business activity, sharing resources, risks, and profits while remaining separate entities.
Sustainable development is a holistic approach to growth that meets present needs without compromising the ability of future generations to meet their own needs. It emphasizes environmental protection, social equity, and economic viability.
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