President Prabowo Approves Transfer of EV Battery Investment from LG to China's Huayou
JAKARTA — President Prabowo Subianto has approved the transfer of the electric vehicle battery ecosystem investment project from the LG consortium to the Zhejiang Huayou Cobalt Co consortium, a Chinese company.
Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia said the EV battery ecosystem project investment amounts to US$9.8 billion. Of this, US$1.2 billion had already been undertaken by the LG consortium. Accordingly, the Huayou consortium will continue with the remaining investment of approximately US$8.6 billion.
"It has been decided and approved by the President. On the President's directive, it is now being carried out by the Huayou consortium. There are no more issues and it is ready for groundbreaking," he said after attending a limited cabinet meeting on the continuation of EV downstream projects at Merdeka Palace, Jakarta, on Thursday (22 May).
Also present at the meeting chaired by Prabowo were Coordinating Minister for Economic Affairs Airlangga Hartarto, State Secretary Minister Prasetyo Hadi, ESDM Minister Bahlil Lahadalia, Investment and Downstream Minister/BKPM Head Rosan Roeslani, SOEs Minister Erick Thohir, Deputy Industry Minister Faisol Riza, and Danantara COO Dony Oskaria.
Bahlil added that the groundbreaking of the Huayou-led EV battery cell factory project would take place before August 2025.
The shareholding structure in the joint venture remains as agreed, with 51 per cent held by state-owned enterprises (SOEs) and 30 per cent in the subsequent joint venture.
"We are working to increase this because Danantara will also participate. The President's directive is for us to maximise it to above 40 per cent, and even up to 50 per cent," he added.
Bahlil also clarified that reports of LG leaving the ambitious project were inaccurate. What actually happened, he explained, was that the government decided to cancel the cooperation because negotiations with LG were deemed to have taken too long.
"As the then Task Force Chairman, I decided to cancel what was being done with LG because it was taking too long. Then, together with Pak Rosan and Pak Erick, we held meetings to find a replacement, namely Huayou. This is the clear information," he explained.
The meeting also discussed progress on the cooperation project with Chinese battery company CATL. Investment and Downstream Minister Rosan emphasised the importance of Danantara's involvement in strengthening Indonesia's position in both mega-projects.
According to Rosan, who also serves as Head of BPI Danantara, Indonesia can dominate the global EV industry value chain. Both consortia are planned to manage the ecosystem from mining through to battery production.
Minister of Energy and Mineral Resources (ESDM) Bahlil Lahadalia said the EV battery ecosystem project investment amounts to US$9.8 billion. Of this, US$1.2 billion had already been undertaken by the LG consortium. Accordingly, the Huayou consortium will continue with the remaining investment of approximately US$8.6 billion.
"It has been decided and approved by the President. On the President's directive, it is now being carried out by the Huayou consortium. There are no more issues and it is ready for groundbreaking," he said after attending a limited cabinet meeting on the continuation of EV downstream projects at Merdeka Palace, Jakarta, on Thursday (22 May).
Also present at the meeting chaired by Prabowo were Coordinating Minister for Economic Affairs Airlangga Hartarto, State Secretary Minister Prasetyo Hadi, ESDM Minister Bahlil Lahadalia, Investment and Downstream Minister/BKPM Head Rosan Roeslani, SOEs Minister Erick Thohir, Deputy Industry Minister Faisol Riza, and Danantara COO Dony Oskaria.
Bahlil added that the groundbreaking of the Huayou-led EV battery cell factory project would take place before August 2025.
The shareholding structure in the joint venture remains as agreed, with 51 per cent held by state-owned enterprises (SOEs) and 30 per cent in the subsequent joint venture.
"We are working to increase this because Danantara will also participate. The President's directive is for us to maximise it to above 40 per cent, and even up to 50 per cent," he added.
Bahlil also clarified that reports of LG leaving the ambitious project were inaccurate. What actually happened, he explained, was that the government decided to cancel the cooperation because negotiations with LG were deemed to have taken too long.
"As the then Task Force Chairman, I decided to cancel what was being done with LG because it was taking too long. Then, together with Pak Rosan and Pak Erick, we held meetings to find a replacement, namely Huayou. This is the clear information," he explained.
The meeting also discussed progress on the cooperation project with Chinese battery company CATL. Investment and Downstream Minister Rosan emphasised the importance of Danantara's involvement in strengthening Indonesia's position in both mega-projects.
According to Rosan, who also serves as Head of BPI Danantara, Indonesia can dominate the global EV industry value chain. Both consortia are planned to manage the ecosystem from mining through to battery production.