Hyundai & LG Invest $1.1 Billion In Battery Plant in Indonesia

South Korean tech and auto giants, Hyundai and LG have collaborated towards a $1.1 billion investment in Indonesia for a battery plant. The two have announced a memorandum of understanding with the government of Indonesia to manufacture electric vehicle batteries via a joint venture. The plan is to build a plant near the capital of Indonesia, Jakarta. 

Already Hyundai is a big player in EVs -- it has its new IONIQ brand dedicated to EVs, while it also makes electric cars under the parent Hyundai brand like the Kona which is even sold in India. Its subsidiary brands Kia and Genesis also have a number of EVs in the works apart from models that are already sold abroad. 

Hyundai leverages the E-GMP modular EV skateboard that it developed in partnership with US-based EV startup Canoo which was once a target of an Apple acquisition. Since then, that startup has gone public via SPAC. 

LG Chem was rebranded to LG Energy Solutions last year 

Earlier in the year, Hyundai announced a massive $7,4 billion investment towards the future of EV development and intended to start production in the US by 2025. 

Its partner in this venture, LG Energy Solutions, is one of the largest battery makers in the world. This business unit was so massive for LG that it spun it off in partnership with Magna. Separately, LG Energy Solutions already had signed a memorandum of understanding with the Indonesian government worth $9.8 billion to make batteries in the country. 

As a part of the deal, the new battery facility will be in Karawang in a 74-acre plot and the $1.12 will be spent towards building the facility. Indonesia is a ripe market for battery manufacturing facilities as its a country that has rich nickel deposits which is a vital raw material for the manufacturing of batteries. 

The Indonesian government is also providing various incentives and rewards to the joint venture to support the stable operating of the upcoming plant. Both companies will own 50 per cent of the plant and it will be completed in the first half of 2023 with mass production of cells slated to start in 2024.