The Government of Indonesia had signed a memorandum of understanding (MoU) with South Korea-based Hyundai Motor Company (Hyundai) and LG Energy Solutions Limited (LG Energy) for the construction of a 10GWh/year lithium-ion battery cell plant in Karawang. Under the terms of the agreement, the two companies will establish a USD1.1 billion joint venture (JV) to collaborate on development of the electric vehicle (EV) battery plant. Both Hyundai and LG Energy will hold equal stakes in the joint venture.
Construction works for the facility is scheduled to start in the fourth quarter of 2021. Commercial production is expected to start in the first half of 2024 and reach full capacity by 2025. The plant’s battery cells will be used in Hyundai Motor and Kia EVs based on Hyundai’s Electric-Global Modular Platform.
This move is in line with the Government of Indonesia’s aim to become a a key player in the global EV supply chain, which includes everything from raw material mining to battery and EV manufacturing.