Indonesia’s electric vehicle (EV) battery ambitions continue to surge as Chinese firm Huayou steps in to replace LG Energy Solution in a high-profile supply chain project. The shift follows LG’s withdrawal from a previously announced multibillion-dollar investment.
Now, Huayou has already committed $8.8 billion (approximately IDR 147.48 trillion) and is positioned to scale that figure up to $20 billion, according to the Indonesian government. The development not only reflects resilience in the EV ecosystem but also reinforces Indonesia’s growing appeal as a regional battery manufacturing hub.
LG Indonesia Investment Officially Replaced by Huayou
Minister of Investment and Head of the Investment Coordinating Board (BKPM), Rosan Roeslani, confirmed that Huayou has officially taken over the project formerly pursued by LG Energy Solution. The original plan involved an integrated EV battery supply chain valued at $9.8 billion.
“Huayou alone has already invested US$8.8 billion in Indonesia as of today. They’ve already put in the capital, it’s done,” said Rosan during a press briefing on April 29, 2025, as cited by cncbcindonesia.com.
He further revealed that Huayou intends to expand its footprint significantly. “They mentioned that the potential investment from the Huayou Group could reach US$20 billion in the future, according to their calculations,” he added.
Huayou Broadens Indonesia EV Battery Operations
Huayou’s expansion goes beyond replacing LG. The company plans to develop industrial park zones in several locations, including Weda Bay in Central Halmahera (North Maluku), Morowali (Central Sulawesi), and Pomalaa (Southeast Sulawesi). These sites are strategically chosen to support downstream nickel processing and battery material production.
“They now also want to develop their own industrial park site, similar to what’s in Morowali or Weda Bay. We want to promote development in other regions as well. This next plan is expected to be located in Pomalaa, Southeast Sulawesi,” Rosan explained.
Such regional expansion reflects Huayou’s long-term vision and aligns with Indonesia’s broader push to localize key segments of the EV supply chain.
LG Remains Active in Indonesia’s Battery Sector
Despite LG’s exit from one major project, the South Korean company has not withdrawn entirely. Rosan clarified that out of four joint ventures related to battery manufacturing, at least one remains operational and is even slated for expansion.
“So, although the announcement said one project was canceled, it doesn’t mean everything was. One JV in the battery segment is still ongoing, and its expansion will proceed shortly,” he said.
LG is now planning to increase its investment in the ongoing JV from $1.1 billion to $1.7 billion (around IDR 28.56 trillion). This expansion signals that South Korea’s commitment to Indonesia’s battery industry remains strong.
Indonesia Strengthens Battery Investment Ecosystem
In the first quarter of 2025 alone, South Korean investment in Indonesia reached $683.29 million, placing the country among Indonesia’s top seven foreign investors. While Huayou’s aggressive investment has made headlines, LG’s continued involvement adds further depth to the sector’s foundation.
“The growth for South Korea continues to increase—very strong indeed,” Rosan remarked during the Q1 Investment Realization press conference.
The Indonesian government continues to welcome both Chinese and Korean capital to accelerate its ambitions of becoming a global hub for EV battery production.
Resilient Outlook After LG Indonesia Investment Shift
The replacement of LG Indonesia investment with Huayou’s multibillion-dollar deal illustrates Indonesia’s adaptability and investment appeal. Backed by expanding industrial infrastructure and strategic partnerships, Indonesia is solidifying its place in the global electric vehicle battery value chain.
Source: cnbcindonesia.com, finance.detik.com
Image: (ANTARA/Muzdaffar Fauzan)
