Tesla, BYD team up to invest in this country's electric-vehicle industry

  • BYD, Tesla, Hyundai and others are all finalizing deals with Indonesia in the electric vehicle space.
File photo of Tesla logo (AFP)
File photo of Tesla logo

US auto giant Tesla has partnered with Chinese automaker BYD and South Korea's Hyundai Motor Co to finalize a deal to invest in Indonesia’s electric-vehicle industry, a senior minister informed Bloomberg, saying that many top global carmakers are coming to the country to invest in battery-powered mobility. “BYD, Tesla, Hyundai and others are all finalizing deals with Indonesia," said Luhut Panjaitan, coordinating minister for maritime affairs and investment.

President Joko Widodo has set out a vision of building out an end-to-end electric-vehicle supply chain onshore by offering potential investors access to Indonesia’s reserves of key battery metals as well as its more than 270 million consumers. Now this plan has started taking shape as global EV and battery producers plan billions of dollars of investment, from Contemporary Amperex Technology Co. Ltd.'s $6 billion mining-to-batteries complex to Hyundai's new EV plant.

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Indonesia, which is Southeast Asia's largest economy, expects $30 billion of investments through 2026 to develop its EV battery ecosystem, according to a Tuesday presentation by Panjaitan. The government is also planning to give as much as 80 million rupiah or $5,271 of subsidy for each EV purchase to boost adoption of battery-powered vehicles. “The cabinet has reached a decision on EV matters and will make an announcement soon," Panjaitan said.

In a separate development, Tesla has taken the price cut strategy to retain its dominance in the global electric car market, which is witnessing the rise of several automakers with their respective products. Wall Street estimates that in 2022 alone, Tesla has slashed the pricing of its electric vehicles by as much as 20 per cent in a bid to retain its supremacy in the zero-emission car market. Interestingly, this move marks a 180-degree turnaround from the Ev maker's strategy over the last two years when the new vehicle orders exceeded supply.

First Published Date: 18 Jan 2023, 12:54 PM IST
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