Ministry Denies Automotive Component Relocation Rumours, Rp1.9 Trillion Investment Remains Secure
The Ministry of Industry (Kemenperin) has confirmed that reports regarding the relocation of automotive component companies from Indonesia to Vietnam are unsubstantiated. Government investigations show that the two companies linked to the issue are still operating normally in Indonesia, with no plans to move production facilities or conduct layoffs (PHK).
Kemenperin spokesperson Febri Hendri Antoni Arief explained that Minister of Industry Agus Gumiwang Kartasasmita had instructed the Directorate General of Metal, Machinery, Transportation Equipment, and Electronics Industries (ILMATE) to directly verify the circulating information. This step was taken because the issue of relocating the automotive component industry is considered sensitive and could potentially affect investor perceptions of the national manufacturing business climate.
From the investigation, the two companies suspected of being the subject of the reports are known to operate in East Java. PT JAI is located in Pasuruan Regency, while PT SAI is in Mojokerto Regency. Both are still actively reporting their industrial activities through the National Industrial Information System (SIINas) in accordance with applicable regulations. The companies have also clarified that their production facilities continue to operate as usual. There is no agenda to move factories to Vietnam or any plan to reduce the workforce.
According to Febri, the government’s preliminary conclusion indicates that industrial activity at both companies remains stable. Information regarding relocation and layoffs that had been widely reported was not found in the field verification results. Kemenperin considers that the spread of unconfirmed information has instead impacted the companies’ business relationships. A number of buyers and suppliers reportedly questioned the sustainability of their cooperation after news of the production facility relocation emerged. This situation is deemed capable of disrupting the automotive component industry supply chain, which has been well-established. Therefore, the government stressed the importance of conveying accurate information so as not to affect the confidence of business actors and investors.
In addition to confirming normal operations, Kemenperin also revealed that both companies make a significant contribution to the national automotive component industry. The total investment realised by the two companies is recorded at more than Rp1.9 trillion. This investment value demonstrates the companies’ long-term commitment to strengthening Indonesia’s manufacturing sector while supporting the global automotive supply chain. In terms of production, the performance of both companies is also maintained. Throughout the first quarter of 2026, PT SAI produced approximately 1.2 million component units, while PT JAI produced around 1.6 million units. All products manufactured are destined for the export market. With a 100 percent export orientation, both companies are an important part of the global automotive component supply chain and contribute to increasing Indonesia’s manufacturing exports amid increasingly fierce industrial competition.