Apple's Batam AirTag Factory Proceeds Despite Trump Tariff Threats
The Ministry of Investment and Downstreaming/BKPM has confirmed that construction of Apple's AirTag factory in Batam will proceed despite threats of import tariffs from US President Donald Trump.
BKPM Deputy for Investment Promotion Nurul Ichwan stressed that Trump's policy would have no significant impact, as AirTag products manufactured in Batam are not intended for the US market.
"The target market, in my view, is not the United States. If the product is made in Indonesia and then shipped to America, the logistics costs would be expensive," said Nurul when met in Jakarta on Tuesday (3 June).
He noted that export opportunities to countries outside the US remain substantial. "I believe the market outside America is still very large and can be supplied with products from Batam," he added.
The project has become increasingly concrete after Apple purchased land in Batam as the factory site. Nurul also revealed that a senior Apple executive had met with Investment Minister Rosan Roeslani and demonstrated full commitment.
"One of the board directors has already met with Minister Rosan, and he guaranteed that the AirTag facility will definitely be built in Indonesia," he affirmed.
Roeslani added that construction of the factory by an Apple vendor has already commenced. The facility will produce 65 per cent of global AirTag demand, with an initial investment value of US$1 billion (approximately Rp16 trillion). The factory is expected to create 2,000 jobs and could expand to a total investment of US$10 billion. The construction target is set for completion by early 2026.
Meanwhile, Donald Trump has again pressured Apple to move iPhone production to the US or face 25 per cent import tariffs. The threat emerged shortly after Foxconn, Apple's primary manufacturing partner, invested US$1.5 billion to expand its operations in India.
Apple CEO Tim Cook had previously stated that the majority of iPhones for the US market would be produced in India, following trade tensions between Washington and Beijing during the Trump era.
BKPM Deputy for Investment Promotion Nurul Ichwan stressed that Trump's policy would have no significant impact, as AirTag products manufactured in Batam are not intended for the US market.
"The target market, in my view, is not the United States. If the product is made in Indonesia and then shipped to America, the logistics costs would be expensive," said Nurul when met in Jakarta on Tuesday (3 June).
He noted that export opportunities to countries outside the US remain substantial. "I believe the market outside America is still very large and can be supplied with products from Batam," he added.
The project has become increasingly concrete after Apple purchased land in Batam as the factory site. Nurul also revealed that a senior Apple executive had met with Investment Minister Rosan Roeslani and demonstrated full commitment.
"One of the board directors has already met with Minister Rosan, and he guaranteed that the AirTag facility will definitely be built in Indonesia," he affirmed.
Roeslani added that construction of the factory by an Apple vendor has already commenced. The facility will produce 65 per cent of global AirTag demand, with an initial investment value of US$1 billion (approximately Rp16 trillion). The factory is expected to create 2,000 jobs and could expand to a total investment of US$10 billion. The construction target is set for completion by early 2026.
Meanwhile, Donald Trump has again pressured Apple to move iPhone production to the US or face 25 per cent import tariffs. The threat emerged shortly after Foxconn, Apple's primary manufacturing partner, invested US$1.5 billion to expand its operations in India.
Apple CEO Tim Cook had previously stated that the majority of iPhones for the US market would be produced in India, following trade tensions between Washington and Beijing during the Trump era.