Hyundai Motor prepares to start producing electric vehicles (EVs) in Indonesia as part of an around $880 million auto investment in the nation, the deputy minister for industry stated on Thursday.
Hyundai’s move to install its first car factory in Southeast Asia fits into the South Korean automaker’s strategy of curbing its reliance on China, where competition is intense and its sales had a hard time because of diplomatic tensions between Seoul and Beijing.
Hyundai Motor, which along with with affiliate Kia Motors is the world’s No.5 automaker, prepares to build a factory in Indonesia with an amount of about 250,000 units, including for electric cars, Indonesian deputy minister for industry Harjanto informed Reuters.
Indonesia has sufficient reserves of nickel laterite ore, an important ingredient for the lithium-ion batteries used to power EVs.
The minister noted the strategy was to export 53 percent of the cars manufactured in the proposed Hyundai plant, significantly to Southeast Asia and Australia, while rest of the 47 percent would be for the domestic market.
Hyundai stated on Friday that it was “considering various ways to expand” in new industries including Southeast Asia. It added however that nothing had been fully considered regarding new production facilities in the region.