Apple AirTag Factory in Batam to Proceed Despite Trump's Tariff Threats
The Ministry of Investment and Downstreaming/BKPM has affirmed that the construction of Apple's AirTag factory in Batam will continue despite US President Donald Trump's plans to impose new import tariffs.
Deputy for Investment Promotion Nurul Ichwan explained when met in Jakarta on Tuesday, 3 June 2025, that AirTag production in Batam is intended for markets outside the United States, meaning the tariff policy will not affect the project's viability.
"The target market, in my view, is not the United States. If it were manufactured in Indonesia and then shipped to the American market, the logistics costs would be expensive," he said.
Nurul Ichwan expressed confidence that although the US market for domestically produced AirTags is relatively small, export opportunities to other countries remain substantial. "I believe the market outside America is still very large and can be supplied with products from Batam," he added.
Furthermore, Nurul Ichwan revealed that Apple has purchased land in Batam as the site for its manufacturing facility. A senior Apple executive also affirmed the company's strong commitment to realising the factory project in Indonesia.
"One of the board directors has already met with Minister Rosan, and he guaranteed that the AirTag factory will definitely be built in Indonesia," he said.
Minister of Investment and Downstreaming and BKPM Head Rosan Roeslani disclosed that construction of the Apple vendor factory in Batam has commenced. The facility is projected to fulfil 65 per cent of global AirTag demand. The investment amounts to a substantial US$1 billion (approximately Rp16 trillion), with the potential to create up to 2,000 jobs. The government plans to encourage this investment to reach US$10 billion. The factory project is targeted for completion in early 2026.
Meanwhile, US President Donald Trump has threatened Apple with a 25 per cent import tariff if the technology giant does not relocate iPhone production to the US. As reported by TechCrunch, the statement came shortly after Apple's primary manufacturing partner, Foxconn, announced a major US$1.5 billion investment to expand its operations in India. This move aligns with Apple's efforts to shift part of its hardware production to India in response to uncertainty in US-China trade relations during the Trump administration.
During an earnings report conference earlier this month, Apple CEO Tim Cook affirmed that the majority of iPhones sold in the United States going forward will be produced in India.
Deputy for Investment Promotion Nurul Ichwan explained when met in Jakarta on Tuesday, 3 June 2025, that AirTag production in Batam is intended for markets outside the United States, meaning the tariff policy will not affect the project's viability.
"The target market, in my view, is not the United States. If it were manufactured in Indonesia and then shipped to the American market, the logistics costs would be expensive," he said.
Nurul Ichwan expressed confidence that although the US market for domestically produced AirTags is relatively small, export opportunities to other countries remain substantial. "I believe the market outside America is still very large and can be supplied with products from Batam," he added.
Furthermore, Nurul Ichwan revealed that Apple has purchased land in Batam as the site for its manufacturing facility. A senior Apple executive also affirmed the company's strong commitment to realising the factory project in Indonesia.
"One of the board directors has already met with Minister Rosan, and he guaranteed that the AirTag factory will definitely be built in Indonesia," he said.
Minister of Investment and Downstreaming and BKPM Head Rosan Roeslani disclosed that construction of the Apple vendor factory in Batam has commenced. The facility is projected to fulfil 65 per cent of global AirTag demand. The investment amounts to a substantial US$1 billion (approximately Rp16 trillion), with the potential to create up to 2,000 jobs. The government plans to encourage this investment to reach US$10 billion. The factory project is targeted for completion in early 2026.
Meanwhile, US President Donald Trump has threatened Apple with a 25 per cent import tariff if the technology giant does not relocate iPhone production to the US. As reported by TechCrunch, the statement came shortly after Apple's primary manufacturing partner, Foxconn, announced a major US$1.5 billion investment to expand its operations in India. This move aligns with Apple's efforts to shift part of its hardware production to India in response to uncertainty in US-China trade relations during the Trump administration.
During an earnings report conference earlier this month, Apple CEO Tim Cook affirmed that the majority of iPhones sold in the United States going forward will be produced in India.