Industry Minister Investigates Two Automotive Factories Rumoured to Relocate to Vietnam, Here Are the Findings

The Ministry of Industry (Kemenperin) has denied reports that two automotive component companies in East Java have relocated their production facilities to Vietnam and carried out layoffs. Spokesperson Febri Hendri Antoni Arief stated that the investigation was launched after Industry Minister Agus Gumiwang Kartasasmita ordered his staff to directly verify the public information regarding the alleged investment relocation. “On Sunday afternoon, 21 June 2026, the Minister of Industry instructed the Director General of ILMATE to investigate the truth of the information about the relocation of automotive component companies from Indonesia to Vietnam. Considering the caution and sensitivity of this issue for the industry and foreign investment in Indonesia’s automotive sector, we are today presenting the field findings to the public,” Febri said in Jakarta on Tuesday (23/6). Based on the investigation by the Directorate General of Metal, Machinery, Transportation Equipment and Electronics Industries (ILMATE), the two companies identified in the reports are PT JAI, located in Pasuruan, and PT SAI, operating in Mojokerto, East Java. Both companies are still actively reporting their industrial activities through the National Industrial Information System (SIINas). The ministry also directly confirmed with the companies regarding the circulating rumours of relocation and layoffs. Both firms stated that their production facilities are still operating normally in Indonesia. “Based on the results of this information verification, we at the Ministry of Industry temporarily conclude that, firstly, there is no plan to relocate the production facilities of PT JAI and PT SAI from Indonesia to Vietnam. And secondly, there has been no workforce reduction or layoffs at these two industrial companies,” Febri stated. According to Kemenperin, the circulating news has instead caused unrest among the business partners of both companies. Several buyers and suppliers have reportedly questioned the veracity of the information and sought assurance regarding the continuation of their business contracts. “The massive reporting on the relocation and layoffs at these two industries in East Java has impacted the automotive industry supply chain and Indonesia’s manufacturing investment climate, particularly for these two automotive component companies,” Febri said. The two companies are known to have a total investment exceeding Rp1.9 trillion. All products manufactured are destined for the export market, making them part of the global automotive supply chain. During the first quarter of 2026, PT SAI produced approximately 1.2 million component units, while PT JAI produced around 1.6 million component units. This performance indicates that production activity is ongoing and continues to support national manufacturing exports. Meanwhile, Industry Minister Agus Gumiwang Kartasasmita has instructed all Kemenperin staff to increase monitoring of industrial conditions across various regions, including following up on information regarding factory closures or layoffs. “The Minister of Industry has ordered his staff to continuously monitor the performance of all industries and to take swift and measured mitigation steps for industries experiencing disruptions in their supply chain and demand,” Febri concluded.