Ministry of Industry Denies Relocation of Automotive Component Firms, Confirms Normal Operations
Jakarta - The Ministry of Industry (Kemenperin) has dismissed rumours regarding the planned departure or relocation of production facilities of two automotive component manufacturers from Indonesia to Vietnam, stating that both companies are operating normally and are in fact contributing to national exports.
Ministry spokesperson Febri Hendri Antoni Arif confirmed in Jakarta on Tuesday that following widespread reports alleging the relocation, Minister of Industry Agus Gumiwang Kartasasmita on Sunday, 21 June 2026, instructed the Director General of Metal, Machinery, Transportation Equipment, and Electronics (ILMATE) to investigate the truth of the information concerning the relocation of production by PT. S and PT. J, as well as the alleged layoffs at the two companies.
“On Sunday afternoon, 21 June 2026, the Minister of Industry ordered the Director General of ILMATE to trace the veracity of the information regarding 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 conveying the field findings to the public,” he stated.
He explained that firstly, PT. J and PT. S, or PT JAI and PT SAI, are both located in East Java province, with PT. JAI situated in Pasuruan Regency and PT. SAI 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 No. 13 of 2025.
The Ministry received confirmation from the companies that they are indeed the two firms named in the reports regarding the relocation of production facilities from Indonesia to Vietnam and layoffs. The production facilities of PT. JAI and PT. SAI are still operating normally in Indonesia and continue their production activities as usual.
He stated there is currently no plan to relocate the production facilities of the two companies from Indonesia to Vietnam. Similarly, regarding the layoff issue, the companies also stated that there has been no reduction in workforce or layoffs at their production facilities.
“Based on the results of this fact-finding, the Ministry of Industry temporarily concludes 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 reduction in workforce or layoffs at the two companies,” Febri revealed.
The issue has caused disruption to the production and demand sides of PT. SAI and PT. JAI. In fact, buyers and suppliers of PT. JAI and PT. SAI expressed shock and questioned the truth of the circulating news as well as the commitment of the two companies to their future contracts.
“The massive reporting on the relocation and layoffs at these two industries in East Java has impacted the automotive component supply chain and the manufacturing investment climate in Indonesia, particularly for these two companies,” said the Ministry spokesperson.
Furthermore, based on the investigation results, the profiles of both companies were obtained. PT. SAI and PT. JAI are automotive component manufacturers with significant investment value, with total investment reaching more than IDR 1.9 trillion. The large 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,” Febri said.
In terms of production performance, both companies are still showing well-functioning industrial activity. In the first quarter of 2026, PT. S realised production of 1.2 million pieces of components, while PT. J produced around 1.6 million pieces. 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 national manufacturing export performance.
He conveyed that the Minister of Industry has also instructed all ranks throughout Indonesia to continue monitoring industrial performance periodically and to follow up on all information related to factory closures and layoffs. All Ministry of Industry personnel are asked to take swift and measured mitigation steps so that production facility closures can be avoided and do not result in layoffs.
“The Minister of Industry has ordered his staff to continuously monitor the performance of all industries and take swift and measured mitigation steps for industries experiencing supply chain and demand disruptions,” Febri said.
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 workforce. The Ministry of Industry also continues to maintain a conducive business climate so that the national manufacturing industry becomes more competitive and able to adapt to global market dynamics.