Environmental groups urge Tesla to not go ahead with nickel plans in Indonesia

Environmental groups asked Tesla to rethink its investment plans for nickel in Indonesia. Multiple groups wrote an open letter to Tesla chief Elon Musk and shareholders to stop direct investments in the country's nickel industry as the EV company is aiming to procure more nickel in order to boost its production.

The groups wrote about the various adverse effect of nickel specifically mentioning the Wawonii Island located in the country's southeast Sulawesi region. The group stated that this island is particularly vulnerable and mining there can damage the coral reefs. According to a report by Bloomberg, the letter has been signed by groups representing Indonesian and US civil society organizations. “The nickel industry in Indonesia has a record of environmental damage, criminalization threats that abuse democracy and equity, the threats to the vulnerable groups, and multiple violations of law," stated the letter.

Earlier, Musk had stated that getting nickel is a priority for Tesla as it wants to push its output. He urged producers two years ago to mine more nickel. “Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way," had added the Tesla CEO.

Indonesia holds almost a quarter of global nickel reserves and has received significant attention from investors in the EV sector. The metal is one of the crucial components in EV batteries. Indonesia’s president, Joko Widodo, offered Musk the opportunity to invest in an end-to-end EV supply chain, according to a CNBC report in June. Though, on the letter written by the environmental groups, representatives of Tesla and the Indonesian government are yet to give their statements.