Former Indonesian President Joko Widodo inaugurated the battery plant involving IBC in June 2024. (Photo: MOTIE)
Indonesia, rich in nickel reserves, is striving to become a key player in the global electric vehicle (EV) supply chain. However, in response to U.S. President Trump’s threat of higher tariffs on Chinese companies, Indonesian battery manufacturers with close ties to Chinese firms are expanding their partnerships with other countries.
For example, Indonesia Battery Corporation (IBC) is targeting Japanese and South Korean companies, while also seeking new raw material suppliers in Australia and South America.
IBC to mitigate risks from U.S. tariffs
Toto Nugroho, CEO of IBC, recently told Nikkei Asia that the company is negotiating with Japanese and South Korean firms, stating, “because that will be key to supplying the U.S. market,” though he did not specify which companies.
Under the previous administration of President Joko Widodo, Chinese companies had dominated Indonesia’s EV battery industry, making it difficult for local businesses to cooperate with European and American companies. As a result, Indonesian firms are now looking to East Asia to avoid the risks posed by the U.S.-China trade and technology conflict.
Toto believes that “The U.S. imposing high tariffs on China puts Indonesia in a very favorable position because Indonesia’s tariffs are relatively lower.”
Toto Nugroho, CEO of IBC, recently stated in an interview that the company is in talks with Japanese and South Korean companies, as these partnerships “will be key to supplying the U.S. market.” (Image source: IBC website)
Founded in 2021, IBC is a joint venture between Indonesia’s state-owned oil company Pertamina, mining giant MIND ID, Aneka Tambang, and the state electricity company PLN.
Its main goal is to build a comprehensive EV battery supply chain, actively seeking foreign investment. In 2022, IBC collaborated with Foxconn and Gogoro to develop the Indonesian battery market.
IBC strengthens non-chinese partnerships
IBC has already completed Southeast Asia's largest EV battery plant in collaboration with South Korea’s Hyundai and LG Energy Solution with annual capacity up to 10 GWh. The plant began operations in June 2024, with President Widodo personally attending the inauguration.
Regarding partnerships with Japanese companies, Toto noted that while Japanese automakers are currently focused on hybrid vehicles, battery raw materials still heavily rely on nickel, which makes Indonesian products appealing to Japanese carmakers.
Additionally, in response to the growing demand for lithium iron phosphate (LFP) batteries driven by Chinese electric vehicles, IBC is developing its manufacturing capabilities for LFP batteries, leveraging Indonesia’s iron ore resources. The company is also continuing its search for partners in Australia and South America to ensure a stable lithium supply.
However, Toto emphasized that IBC will maintain its partnership with China’s CATL. Both companies are expected to develop a factory that can handle the entire lifecycle of batteries. While progress has slowed, the goal remains to start operations by 2027.
Source: Nikkei Asia, Jakarta Globe
