Indonesian Media Outlets Report
Many local media outlets in Indonesia are reporting that Hyundai Motor will establish an electric vehicle (EV) factory in Indonesia. Chung Eui-sun, senior vice chairman of Hyundai Motor Group, recently met with Joko Widodo, president of Indonesia, to request the Indonesian government’s support for Hyundai’s investment in the Southeast Asian country.
Local news outlets including Antara News Agency reported on July 26 that Hyundai Motor would set up an EV factory in Karawang, west of Java, and sign an agreement with Luhut Binsar Pandjaitan, coordinating minister for maritime affairs of Indonesia, in November when the Korea-ASEAN Special Summit will be held.
The minister was quoted as saying that Hyundai plans to invest about US$1 billion and has secured the plant site in Karawang. He added that the contract would be signed in Seoul in November.
The minister was quoted as saying that the deal will be signed during the Korea-ASEAN Special Summit to be held in Busan, Korea from Nov. 25-26 in the presence of the Korean and Indonesian presidents. Widodo will visit Korea to attend the Korea-ASEAN Special Summit. The minister also said that the Indonesian government will encourage LG Chem to cooperate with Chinese battery manufacturer CATL to supply lithium batteries for electric vehicles.
However, Hyundai Motor announced that nothing had been set about the construction of an EV plant in Indonesia.
Hyundai plans to turn its Chongqing Plant 5 in China into an EV factory in an effort to find a way out of slump for its sluggish Chinese business. Hyundai Motor is struggling in the Chinese market as demand for cars in China has been shrinking due to the U.S.-China trade dispute. The Chinese government’s regulation requiring auto companies to produce environment-friendly cars in China has added a further burden to Hyundai.
Hyundai Motor began to change production lines to produce EVs at Chongqing Plant 5 in Sichuan, China, said sources in the automobile industry on July 28. Hyundai plans to ramp up production of EVs instead of reducing production of internal combustion engine models, in particular, the Encino gasoline model. The automaker will also begin reorganizing its production lines to launch the Lafesta EV later this year. When the Lafesta EV is produced in September, Chongqing Plant will be transformed into a plant that produces EVs of Hyundai Motor's Chinese subsidiary.