Indonesia’s Investment Minister announced that Apple plans to set up a manufacturing facility in Batam early in 2026 to produce its AirTag tracking devices. The facility will supply 65% of Apple’s global AirTag demand. The small, coin-shaped device is designed to help users easily locate their belongings. Industry experts speculate that this initiative could be part of Apple’s broader strategy to persuade Jakarta to lift the sales ban on the iPhone 16.
The minister stated that the company has fully committed to the initial phase of constructing the AirTag manufacturing facility in Batam. This project is part of Apple’s broader USD 1 billion investment pledge in Indonesia.
Apple has resumed discussions on its investment plans in Indonesia, with its Vice President for Global Government Affairs meeting with key authorities, including the Investment Minister and the Industry Minister, to explore potential opportunities.
The minister stated that the company had not met Indonesia’s local content regulations, which mandate that at least 40% of components or production processes be sourced domestically as part of efforts to attract major tech investments. In response, Apple initially proposed a USD 10 million investment in Indonesia, later increasing the offer to USD 100 million. In December 2025, Apple further raised the investment commitment to USD 1 billion, an amount deemed acceptable by the Indonesian President.
The Investment Minister indicated that Apple’s investment strategy in Indonesia is expected to align with its approach in other Southeast Asian countries, where Vietnam hosts over 30 Apple suppliers, and Thailand has more than 23 vendors. The minister also mentioned that Apple has already assessed a potential manufacturing site in Batam. While discussions seem to progress positively, the Industry Minister noted that the proposed USD 1 billion investment remains “insufficient.”
According to Tempo, Apple must adhere to four “fairness principles” set by the Indonesian government. These principles include evaluating Apple’s investment activities in other countries, comparing investments made by other mobile phone manufacturers in Indonesia, assessing the potential for increased value and revenue for Indonesia, and ensuring the creation of local employment opportunities.
As of now, Apple does not have any manufacturing facilities in Indonesia. However, since 2018, the company has established application developer academies, enabling it to sell older models of its products in the country.
(Source: Channel News Asia)
