LG Maintains Commitment to Electric Vehicle Battery Project as Indonesia Seeks Faster Progress
Minister of Investment and Downstreaming/Head of the Investment Coordinating Board (BKPM) Rosan Roeslani has stated that LG, previously reported to have cancelled its investment in the electric vehicle (EV) ecosystem project, has not entirely withdrawn from the development of the project.
He explained that the project comprises four joint ventures with different development focuses, and confirmed that LG remains involved in one of the joint ventures within the project known as the Grand Package.
"What I wish to convey is that LG's commitment remains substantial," he said in Jakarta on Tuesday (29/4).
Rosan stated that in the initial phase of investment, LG had already realised capital investment of US$1.1 billion (Rp18.4 trillion at an exchange rate of Rp16,764), and plans to add a further US$1.7 billion (Rp28.5 trillion) in the second phase of battery cell development under the Grand Package project.
"So the total investment could reach, once completed, US$2.8 billion (Rp46.9 trillion) for joint venture number four, which is in line with the initial target for this joint venture," he added.
Furthermore, Rosan said he would visit the battery factory already built by LG in Karawang, West Java, the following day, which was the result of the initial phase of investment.
"Tomorrow I will also visit the battery factory, because there have already been preliminary discussions with our side, and in fact they wish to increase their investment," he said.
Rosan explained that LG Energy Solution did not withdraw from part of its investment in the battery ecosystem project; rather, it was the Indonesian Government that asked LG to step back because negotiations had been running for too long.
Rosan said negotiations with LG had been ongoing for five years since 2020.
"It was said that they (LG) severed ties, but in fact it was more accurately us who made the decision. This was based on a letter dated 31 January 2025 issued by the Ministry of Energy and Mineral Resources of the Republic of Indonesia. Why was that letter issued? Because the negotiations had indeed gone on for too long, whilst we wanted everything to proceed well and swiftly, as negotiations had already been running for five years," Rosan said at a press conference at the Presidential Office, Presidential Palace, Jakarta, on Wednesday evening (23/4).
Rosan continued that the letter was subsequently issued to LG because Chinese investor Huayou had expressed its desire to invest in the battery ecosystem sector. Huayou's interest in joining the battery project consortium in Indonesia had been made known since 2024.
He explained that the project comprises four joint ventures with different development focuses, and confirmed that LG remains involved in one of the joint ventures within the project known as the Grand Package.
"What I wish to convey is that LG's commitment remains substantial," he said in Jakarta on Tuesday (29/4).
Rosan stated that in the initial phase of investment, LG had already realised capital investment of US$1.1 billion (Rp18.4 trillion at an exchange rate of Rp16,764), and plans to add a further US$1.7 billion (Rp28.5 trillion) in the second phase of battery cell development under the Grand Package project.
"So the total investment could reach, once completed, US$2.8 billion (Rp46.9 trillion) for joint venture number four, which is in line with the initial target for this joint venture," he added.
Furthermore, Rosan said he would visit the battery factory already built by LG in Karawang, West Java, the following day, which was the result of the initial phase of investment.
"Tomorrow I will also visit the battery factory, because there have already been preliminary discussions with our side, and in fact they wish to increase their investment," he said.
Rosan explained that LG Energy Solution did not withdraw from part of its investment in the battery ecosystem project; rather, it was the Indonesian Government that asked LG to step back because negotiations had been running for too long.
Rosan said negotiations with LG had been ongoing for five years since 2020.
"It was said that they (LG) severed ties, but in fact it was more accurately us who made the decision. This was based on a letter dated 31 January 2025 issued by the Ministry of Energy and Mineral Resources of the Republic of Indonesia. Why was that letter issued? Because the negotiations had indeed gone on for too long, whilst we wanted everything to proceed well and swiftly, as negotiations had already been running for five years," Rosan said at a press conference at the Presidential Office, Presidential Palace, Jakarta, on Wednesday evening (23/4).
Rosan continued that the letter was subsequently issued to LG because Chinese investor Huayou had expressed its desire to invest in the battery ecosystem sector. Huayou's interest in joining the battery project consortium in Indonesia had been made known since 2024.