Minister Bahlil Denies LG Withdrew from EV Battery Project, Says Government Cancelled the Deal
Jakarta — Minister of Energy and Mineral Resources Bahlil Lahadalia has denied reports that South Korean company LG withdrew from its electric vehicle (EV) battery development investment project in Indonesia. He affirmed that it was the government that decided to cancel the cooperation.
"The information suggesting that LG pulled out is incorrect. The truth is that I, as head of the task force at the time, decided to cancel the cooperation because the process was taking too long," said Bahlil after meeting President Prabowo Subianto at the Presidential Palace in Jakarta on Thursday (22/5/2025).
Although he did not elaborate on what he meant by "too long", Bahlil said the decision had been discussed with Investment Minister/BKPM Head Rosan Roeslani and State-Owned Enterprises Minister Erick Thohir.
Bahlil also emphasised that investment opportunities in the downstream processing sector, particularly critical minerals, remain highly promising amid current global economic challenges.
According to Bahlil, the EV battery project originally undertaken by LG was valued at a total of US$9.8 billion, or approximately Rp 159.99 trillion (at an exchange rate of Rp 16,326 per US dollar). LG had completed the first phase worth US$1.2 billion, or approximately Rp 19.59 trillion, with a production capacity of 10 gigawatts.
However, the remaining investment of US$8 billion, or approximately Rp 130.61 trillion, will be continued by Chinese company Huayou. This new collaboration with Huayou is regarded as a strategic move to accelerate the development of the national electric vehicle ecosystem.
The government hopes this partnership will drive the acceleration of EV battery industry downstream processing in Indonesia.
"The information suggesting that LG pulled out is incorrect. The truth is that I, as head of the task force at the time, decided to cancel the cooperation because the process was taking too long," said Bahlil after meeting President Prabowo Subianto at the Presidential Palace in Jakarta on Thursday (22/5/2025).
Although he did not elaborate on what he meant by "too long", Bahlil said the decision had been discussed with Investment Minister/BKPM Head Rosan Roeslani and State-Owned Enterprises Minister Erick Thohir.
Bahlil also emphasised that investment opportunities in the downstream processing sector, particularly critical minerals, remain highly promising amid current global economic challenges.
According to Bahlil, the EV battery project originally undertaken by LG was valued at a total of US$9.8 billion, or approximately Rp 159.99 trillion (at an exchange rate of Rp 16,326 per US dollar). LG had completed the first phase worth US$1.2 billion, or approximately Rp 19.59 trillion, with a production capacity of 10 gigawatts.
However, the remaining investment of US$8 billion, or approximately Rp 130.61 trillion, will be continued by Chinese company Huayou. This new collaboration with Huayou is regarded as a strategic move to accelerate the development of the national electric vehicle ecosystem.
The government hopes this partnership will drive the acceleration of EV battery industry downstream processing in Indonesia.