Indonesia's nickel riches spur local company EV, battery ambition

Nikkei Asia ^

[FarCenter]

JAKARTA -- From coal miners to conglomerates, Indonesia's burgeoning electric vehicle and battery scene is attracting broad local corporate interest buoyed by the country's rich nickel resources and government promises of incentives.

The involvement comes as global EV makers including China's BYD and Tesla of the U.S. have either signed or are "finalizing" deals to invest in Indonesia, Luhut Pandjaitan, coordinating minister for maritime affairs and investment, told a briefing of Indonesian regional leaders last month.

Companies hope to ride on the government's push to utilize the nickel reserves to develop a battery industry, enter the global EV supply chain and develop a manufacturing base. With a population of more than 270 million, Indonesia also offers a potentially huge market.

But formidable challenges to individual, public and business adoption include consumer affordability, lack of public charging infrastructure and corporate governance questions over potential conflicts of interest arising from close relations among government officials, politicians and companies.

Among the most aggressive entrants so far is family-controlled Bakrie & Brothers, a conglomerate with interests spanning energy, infrastructure and telecommunications. It supplied dozens of BYD's electric buses to the TransJakarta public bus system last year through subsidiary VKTR Teknologi Mobilitas and is seeking more deals.

"For 80 years, Bakrie & Brothers has focused on steel, infrastructure and other [areas]," Anindya Bakrie, company president, said at a public event in December. He added that the next three areas the company would focus on are electrification, renewable energy and digitalization.

Indonesia is the world's biggest producer of nickel, a key component in long-range EV batteries. Dozens of battery-related projects are under construction -- mainly on nickel-rich Sulawesi and Halmahera islands, including ones led by Chinese battery giant Contemporary Amperex Technology (CATL) and its South Korean rival LG Energy Solution.

Some local companies are building smelters to process nickel ore into feedstock for battery production. Others are focusing on manufacturing and/or distribution of e-scooters and commercial EVs such as buses and trucks, as electric cars remain largely unaffordable for most Indonesians. Still others are installing charging or battery swap stations. And many are collaborating with foreign companies to catch up on technology and aid financing.

[FarCenter]

Indonesia aspires to produce finished goods, not mineral raw materials.

[Bloody Sam Roberts]

I’m sure the Chinese would be happy to mine it for them for a substantial piece of the pie.

[FarCenter]

The Chinese battery manufacturers are setting up plants in Indonesia. CATL is the biggest globally.

[Tell It Right]

All of this would be a non-issue for us if the U.S. did free markets both with car types and energy.

There aren't enough rare-earths in the U.S. to supply our EV's and solar and such if the Dims get their way into forcing us into "going green". But there's plenty to supply those who do it willingly --- that is, if the Dims get out of the way of mining and processing rare-earths. We enough even of cobalt to supply what we need.

The same for oil and natural gas. If the Dims get out of the way of that too we have plenty of what we need for everybody who wants to use those energy sources. Trump showed us this.

[MMusson]

Clear-cutting the Indonesian Rainforest so they can strip mine Nickel Laterites.

Processing nickel laterites involves crushing them and dumping them in giant coal powered smelters and burning away the impurities. It is one of the most CO2 intensive processes around.