Tag: Nickel

  • Indonesia’s EV and Battery Industry: Nickel, Policy and the Road to 2030

    Indonesia’s EV and Battery Industry: Nickel, Policy and the Road to 2030

    Top image: Photo: Government of North Morowali, Indonesia, Public domain, via Wikimedia Commons

    Indonesia wants to do more than buy electric vehicles. It wants to make them, from the nickel in the ground to the finished battery pack. That goal has shaped policy for more than five years, including export bans, tax incentives and billion-dollar deals with Chinese and Korean partners. This guide explains how the strategy works, who the main players are, what has been built so far, what the government is aiming for by 2030 and where it could go wrong.

    Why nickel matters

    Nickel is a key ingredient in the NMC (nickel-manganese-cobalt) and similar battery chemistries used in many long-range EVs. Indonesia dominates the supply. The US Geological Survey estimates that Indonesia mined about 2.6 million tonnes of nickel in 2025, around two-thirds of the world’s 3.9 million tonnes. It also holds some 62 million tonnes of reserves out of a global total of more than 140 million tonnes.

    Downstreaming: the export ban and what followed

    In 2020 Indonesia reinstated a ban on exporting raw nickel ore. The aim was to force processing to happen at home. A March 2026 policy paper from the London School of Economics’ Centre for Economic Transition Expertise (CETEx) found that the ban brought a wave of mostly foreign investment in smelters. That investment went largely into huge industrial parks such as the Indonesia Morowali Industrial Park (IMIP) in Central Sulawesi and Weda Bay (IWIP) in North Maluku. According to the paper, Indonesia has produced more than half of the world’s nickel since 2023, and its exports have moved from ore towards higher-value products, including the nickel sulphate used in batteries.

    Output has grown so fast that the government is now holding it back. For 2026 the energy ministry cut the approved ore quota (RKAB) to about 260 million tonnes, from 379 million tonnes in 2025, to ease oversupply and support prices, CNBC Indonesia reported. Indonesia also imported about 15.8 million tonnes of ore in 2025, mostly from the Philippines, to keep its smelters supplied.

    Indonesia Battery Corporation and the big projects

    Indonesia Battery Corporation (IBC), or PT Industri Baterai Indonesia, is a state-owned holding company set up to be the government’s partner in battery projects. There are three projects to know about.

    Hyundai–LG: the first cell plant

    HLI Green Power in Karawang, West Java, was opened by President Joko Widodo in July 2024 as Indonesia’s first large EV battery-cell factory (CNBC Indonesia). It was the first 10 GWh of a planned 30 GWh “Indonesia Grand Package” agreed with LG Energy Solution. LG pulled out of the remaining stages in early 2025, and China’s Huayou took over. The Antam–IBC–Huayou consortium agreement was signed in January 2026, Antara reported.

    CATL: an integrated project worth about US$6 billion

    In June 2025 a CATL subsidiary broke ground with Antam and IBC on a project costing nearly US$6 billion. It covers nickel mining and processing, cathode materials and recycling in East Halmahera, and cell manufacturing in Karawang. CATL says the Halmahera facilities will eventually produce 142,000 tonnes of nickel and 30,000 tonnes of cathode material a year. The Karawang cell plant, run by the joint venture PT CATIB, has a first-phase capacity of 6.9 GWh. It began phased operations in August 2026, according to the energy ministry, and is expected to make both LFP and nickel-based batteries (Suara).

    Vehicle makers moving in

    Carmakers are building factories too. BYD opened its plant in Subang, West Java, on 3 September 2026, which is expected to employ around 5,000 local workers (Antara). Several other Chinese brands now assemble in Indonesia. That is partly because tax breaks for fully imported EVs ended in December 2025, and brands that imported cars under the scheme promised to build the same number locally between 2026 and 2027.

    Policy levers

    • Local content (TKDN). EVs must meet rising local-content minimums to qualify for incentives: 40% in 2026, 60% in 2027–2029 and 80% in 2030 (Antara).
    • Incentives that favour nickel. The VAT incentive announced in 2026 gives a larger discount to cars with nickel-based batteries. The then finance minister said this was meant to get Indonesia’s own nickel used (CNBC Indonesia).
    • A national motorbike programme. The Molinas initiative, launched in August 2026, aims to connect nickel refining, cell making and two-wheeler assembly in one domestic supply chain (Antara).

    The road to 2030: targets

    • Production of 600,000 electric cars and 2.45 million electric motorbikes a year by 2030, set by the industry ministry (Kompas).
    • 62,918 four-wheel public chargers by 2030, compared with about 4,892 in May 2026 (Periskop).
    • The ministry’s TKDN roadmap, reaching 80% in 2030.

    Domestic demand is growing. BEV wholesales passed 101,000 in the first eight months of 2026 (Kompas).

    The challenges

    • The shift to LFP. Many of the best-selling EVs in Indonesia and worldwide use lithium iron phosphate (LFP) batteries, which contain no nickel. IBC’s own chief executive has said LFP now dominates the local market (Suara). That makes it harder to argue that nickel will automatically turn into battery value.
    • Prices and oversupply. Data cited by the USGS shows the global nickel market in surplus every year since 2022. That squeezes margins and is the reason for the production quota cuts.
    • Environmental and social costs. CETEx notes that nickel miners cleared more than 75,000 hectares of forest in 2007–2022, and that much of the processing runs on captive coal power plants. New mining in sensitive areas such as Raja Ampat has caused public concern.
    • Concentration and policy risk. CETEx also points to the dominance of Chinese-Indonesian smelting groups. Repeated delays to consumer incentives in 2026 have made demand less predictable.

    This guide describes policy and investment as reported at the time of writing. Targets, quotas and incentive rules are revised often, so check the latest announcements from the ministries concerned.

    FAQ

    What is nickel downstreaming?

    It is the policy of processing nickel ore in Indonesia instead of exporting it raw. It is backed by an ore export ban that was reinstated in 2020.

    What is Indonesia Battery Corporation?

    It is a state-owned battery holding company that partners with foreign firms such as CATL, Huayou and LG on cell and materials projects.

    Does Indonesia make EV batteries yet?

    Yes. The Hyundai–LG plant in Karawang has operated since 2024, and the CATL–IBC plant began phased operations in August 2026.

    What are the 2030 targets?

    Annual production of 600,000 electric cars and 2.45 million electric motorbikes, with 80% local content and nearly 63,000 public car chargers.

    Sources: USGS – Mineral Commodity Summaries 2026: Nickel; CETEx (LSE) – How Indonesia’s ban on raw nickel exports provides lessons; CNBC Indonesia – Produksi Bijih Nikel RI Dipangkas Jadi 260-an Juta Ton; Antara – Indonesia targets 2026 groundbreaking for Huayou EV battery project; CATL – CATL and Partners Break Ground on US$6 Billion Battery Integration Project in Indonesia; Suara – Pabrik Baterai PT CATIB di Karawang Sudah Beroperasi; CNBC Indonesia – Siap-Siap Pabrik Baterai EV Raksasa Ke-2 RI Segera Beroperasi; Antara – Pemerintah kaji insentif kendaraan listrik berbasis TKDN; CNBC Indonesia – Purbaya Tunda Insentif Mobil Listrik; Kompas – Kemenperin Targetkan Produksi Mobil Listrik 600.000 Unit pada 2030; Periskop – Konsumsi SPKLU Tembus 62,4 Juta kWh; CNN Indonesia – Daftar Insentif Mobil Listrik yang Disetop; Antara (English) – Molinas marks new chapter; Kompas – Daftar Mobil Listrik Terlaris hingga Agustus 2026

  • CATL-IBC battery plant in Karawang starts phased operations

    CATL-IBC battery plant in Karawang starts phased operations

    Top image: Photo: Ministry of Public Works of Indonesia – Kementerian PUPR Republik Indonesia, Public domain, via Wikimedia Commons

    Indonesia’s flagship electric vehicle battery factory, a joint venture between China’s CATL and state-owned Indonesia Battery Corporation (IBC) in Karawang, West Java, has begun operating on a phased basis, government officials said in August. The plant is a key piece of Jakarta’s plan to turn the country’s vast nickel reserves into a domestic battery industry.

    Commissioning under way

    Ahmad Erani Yustika, secretary-general of the Ministry of Energy and Mineral Resources, confirmed the start of operations to Bloomberg Technoz on 21 August:

    “It may still be in stages, but it has started operating.” – Ahmad Erani Yustika, Ministry of Energy and Mineral Resources, to Bloomberg Technoz (translated from Indonesian)

    Bloomberg Technoz reported that commissioning was under way and that the factory had been expected to be formally inaugurated by President Prabowo Subianto before Independence Day on 17 August, although the ceremony was still awaiting a date in the president’s schedule. English-language outlet Investortrust described the start as trial runs and quoted Mr Erani as saying construction was effectively complete.

    Cells, modules and packs

    The plant is run by PT Contemporary Amperex Technology Indonesia Battery (CATIB), a company formed by CATL subsidiary CBL, mining firm Antam and IBC. Speaking to Bisnis.com in June, IBC chief executive Aditya Farhan Arif said CATIB would produce battery cells, modules and complete battery packs, serving both electric vehicles and battery energy storage systems (BESS).

    Initial capacity is 6.9 GWh a year, with plans to expand to 15 GWh – more than double – which Bisnis said was targeted for the following year. Mr Aditya signalled that the pace of expansion would depend on the market:

    “With batteries, a battery factory really has to wait for demand.” – Aditya Farhan Arif, IBC, to Bisnis.com (translated from Indonesian)

    IBC has also said it hopes to export batteries to Europe, kumparan reported in May.

    Part of a larger nickel-to-EV chain

    According to Investortrust, the Karawang plant represents an investment of about US$1.2 billion and forms part of the wider Indonesia Battery Integration Project, valued at US$5.9–6 billion, which aims to link nickel mining and processing with cell production and recycling. The outlet also quoted President Prabowo setting a goal of large-scale commercial production of Indonesian electric passenger cars by 2028.

    Indonesia holds the world’s largest nickel reserves, and nickel-based chemistries such as NMC are central to the government’s industrial strategy. However, many of the most popular EVs now sold in Indonesia use lithium iron phosphate (LFP) batteries, which contain no nickel – one reason why officials are keen to secure a domestic cell supply chain that carmakers will actually use. Whether the Karawang plant’s output ends up in locally assembled cars, energy storage or exports will be closely watched.

    What it means for buyers

    For now, the start of production at Karawang will not change the price of any EV in a showroom. Over time, however, a domestic source of cells and packs should help carmakers meet Indonesia’s rising local-content requirements – 60% from January 2027 – which determine eligibility for tax incentives. Locally made batteries could also make replacement packs and battery servicing easier and cheaper to obtain, a common concern for Indonesian buyers weighing up an EV’s long-term running costs.

    Sources: Bloomberg Technoz – Pabrik Baterai CATL & IBC di Karawang Resmi Beroperasi; Bisnis.com – Pabrik Baterai CATL-IBC di Karawang Punya Kapasitas Awal 6,9 GWh per Tahun; Investortrust – CATL-IBC battery plant begins trial runs in West Java; kumparan – Pabrik Baterai Listrik di Karawang Beroperasi Juli 2026, IBC Mau Ekspor ke Eropa

  • Prabowo launches Molinas national e-motorcycle programme to use nickel

    Prabowo launches Molinas national e-motorcycle programme to use nickel

    Top image: Photo: AntaraTV, CC BY 3.0, via Wikimedia Commons

    President Prabowo Subianto has launched Molinas, short for Motor Listrik Nasional (National Electric Motorcycle), a government-led programme to build a domestic electric motorcycle industry backed by locally processed nickel batteries. The launch took place on 13 August 2026 at the production facility of electric motorcycle maker ALVA in Cikarang, Bekasi, West Java.

    More than a single bike

    Despite the name, Molinas is not one model but an ecosystem. According to Antara, it covers manufacturing and components, batteries, charging and battery-swapping infrastructure, financing, distribution, after-sales service and market uptake. The Jakarta Post reported that state-owned PT Len Industri is the lead integrator, working with the sovereign wealth fund Danantara and at least 10 national motorcycle companies that meet local-content requirements. ALVA is produced by PT Ilectra Motor Group, part of the Indika Energy group.

    Mr Prabowo described the programme as a collaboration between private companies, state-owned enterprises and universities:

    “Today, in my opinion, is one good example of what I call Indonesia Incorporated.” – President Prabowo Subianto, reported by Antara

    The nickel angle

    A central aim is to create demand for batteries made from Indonesian nickel. Indonesia holds around 46% of the world’s nickel reserves, and Rosan Roeslani – investment and downstreaming minister and chief executive of Danantara – linked the programme’s affordability directly to that resource, Antara reported:

    “Molinas can be affordable and high quality, especially since we can carry out downstreaming from nickel into batteries.” – Rosan Roeslani, reported by Antara

    Mr Rosan also framed the programme as a question of economic self-reliance, telling the launch that Indonesia needed to stand on its own feet in every area of economic activity, according to the Cabinet Secretariat.

    Big targets from a small base

    The scale of ambition is considerable. A follow-up report by Antara noted that Indonesia sells 6–7 million motorcycles a year, but only 60,000–70,000 of them – about 1% – are electric. It said 69 companies already make battery-powered vehicles, with a combined capacity of 2.511 million units a year, and that at least 10 local firms meet local-content rules. ALVA currently produces around 20,000 units a year and aims to expand to 200,000.

    Antara reported a national goal of 2 million Molinas e-motorcycles, without a specified timeframe, and a longer-term target of 11 million electric motorcycles on the road by 2037. Supporters argue that the shift could cut fuel subsidy spending by Rp 82.2 trillion between 2027 and 2037 and create around 215,000 direct and indirect jobs.

    What it means for buyers

    Molinas does not yet change what riders can buy or how much they pay. Its practical effect will depend on the details still to come: which models carry the Molinas label, whether battery-swapping networks become widespread enough to ease range worries, and how financing schemes are structured. It also sits alongside the separate Rp 3 million purchase incentive for locally made e-motorcycles, which has yet to take effect. Buyers interested in a Molinas-affiliated bike should look for clear information on battery warranties, swapping availability in their city and after-sales coverage before committing.

    Sources: Antara – Indonesia launches Molinas in push for electric vehicle self-reliance; Antara – Prabowo calls Molinas an example of “Indonesia Incorporated”; Antara – ‘Molinas’ marks new chapter in Indonesia’s EV industrialization; The Jakarta Post – Prabowo kicks off e-motorcycle ecosystem to push nickel use; Cabinet Secretariat – President Prabowo launches National Electric Motorcycle (MoLiNas)