Hyundai Motor and LG Energy Solution said on Thursday they would establish a joint venture in Indonesia to establish a battery cell plant for electric vehicles (EV), investing $1.1 billion.
Both companies will be owning 50-50 of the JV.
The JV will help Hyundai to secure a stable supply of EV batteries at a competitive price for their battery electric vehicles.
LG Energy Solution, the battery subsidiary of LG Chem, and Hyundai signed a memorandum of understanding with the Indonesian government for building the plant in the country, the companies said in a joint statement on Thursday.
Construction of the plant will begin in the fourth quarter of 2021 and will be finished by the first half of 2023, the companies said.
Indonesia is promoting the domestic development of electric vehicles and battery production for creating a downstream industry for the country’s strong supply of lithium battery ingredients, nickel laterite ore.