Ministry of Industry Denies Automotive Component Factory Relocation to Vietnam
The Ministry of Industry (Kemenperin) has dismissed rumours regarding the planned departure or relocation of production facilities belonging to two automotive component manufacturers from Indonesia to Vietnam. Kemenperin stated that both companies continue to operate normally and are, in fact, contributing to national exports.
Kemenperin Spokesperson Febri Hendri Antoni Arif, when confirmed in Jakarta on Tuesday (23/6/2026), said that following up on circulating reports concerning the alleged relocation, Minister of Industry Agus Gumiwang Kartasasasmita on Sunday (21/6/2026) ordered the Director General of Metal, Machinery, Transportation Equipment and Electronics Industries (Dirjen ILMATE) to investigate the truth of the information regarding the production relocation of PT J and PT S, as well as layoffs at the two companies.
‘On Sunday afternoon (21/6/2026), the Minister of Industry ordered Dirjen 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, today we are presenting the field findings to the public,’ he said.
He explained that PT J and PT S, or PT JAI and PT SAI, are both located in East Java Province. PT JAI is located in Pasuruan Regency, while PT SAI is located in Mojokerto Regency. Both companies are also recorded as actively submitting industrial activity reports through the National Industrial Information System (SIINas) routinely in accordance with the provisions of Minister of Industry Regulation (Permenperin) Number 13 of 2025.
Kemenperin received confirmation from the companies that the two industrial companies, PT JAI and PT SAI, which appeared in the reports of relocating production facilities from Indonesia to Vietnam and layoffs, are indeed the companies in question. The production facilities of PT JAI and PT SAI are still operating normally in Indonesia and continue to carry out production activities as usual.
He stated that there are currently no plans to relocate the production facilities of the two companies from Indonesia to Vietnam. The same applies to the layoff issue. The companies stated that there has been no reduction in workforce or layoffs at their production facilities.
‘Based on the results of this information verification, we from the Ministry of Industry tentatively conclude that first, there are no plans yet to relocate the production facilities of PT JAI and PT SAI from Indonesia to Vietnam. Second, there has been no reduction in workforce or layoffs at the two industrial companies,’ Febri revealed.
This issue has caused disruption to the production and demand sides of PT SAI and PT JAI. In fact, buyers and suppliers of both companies admitted they were surprised and questioned the truth of the circulating information as well as the companies’ commitment to their future contracts.
‘The massive reporting on relocation and layoffs at these two industries in East Java has impacted the automotive industry supply chain and Indonesia’s manufacturing investment climate, especially for these two automotive component companies,’ said the Kemenperin Spokesperson.
Furthermore, based on the investigation results, Kemenperin also obtained the profiles of both companies. PT SAI and PT JAI are automotive component manufacturers with significant investment value, reaching more than Rp 1.9 trillion. The magnitude of this investment value reflects the long-term commitment of both companies to supporting the development of the national manufacturing industry and strengthening the automotive industry supply chain in Indonesia.
‘The realised investment value demonstrates the companies’ trust and commitment to continue developing their business and investment in Indonesia,’ said Febri.
In terms of production performance, both companies also continue to show well-functioning industrial activity. In the first quarter of 2026, PT S realised production of 1.2 million component pieces, while PT J produced approximately 1.6 million component pieces. Moreover, all production output from both companies is destined for the export market. With a 100 percent export orientation, both companies are part of the global automotive industry supply chain and contribute to Indonesia’s manufacturing export performance.
He stated that the Minister of Industry has also instructed all his staff across Indonesia to continue monitoring industrial performance periodically and to follow up on any information related to factory closures and layoffs. All Kemenperin staff have been asked to take swift and measured mitigation steps so that the closure of production facilities can be avoided and does not result in layoffs.
‘The Minister of Industry has ordered his staff to continue monitoring the performance of all industries and to take swift and measured mitigation steps for industries experiencing disruptions in the supply chain and demand,’ said Febri.
The government, he said, will continue to monitor and coordinate with industry players to ensure investment sustainability, production stability, demand certainty, and protection for the national industrial workforce. Kemenperin also continues to maintain a conducive business climate so that the national manufacturing industry becomes increasingly competitive and able to adapt to global market dynamics.