Chinese Firm Invests in Lithium Battery Production in Indonesia

Sep 2020

China’s Contemporary Amperex Technology (CATL) has invested USD 2.6 billion in building the largest lithium battery production facility in Indonesia. This is in line with Indonesia’s efforts to develop the downstream industry as the country banned exports of nickel ore in January 2020.

Besides CATL, a local battery-maker PT International Chemical Industry has also invested USD 14 million to develop a lithium ion battery production facility. The factory is set to produce 25 million lithium cell batteries annually by 2021.

Indonesia had an abundant domestic supply of nickel, the primary material for lithium batteries. However, initial high capital investment remains as a challenge to develop the Indonesia’s battery industry. Growth in the sector is also constrained by lack of standardization. Charging station requirements vary by battery type.

The country’s large population size and the government’s support for low-emission vehicles indicate a promising future for the EV battery industry. The demand for battery-powered electricity could reach up to 15 gigawatts if 10% of scooters and motorcycles were to be entirely replaced by electric scooters.

(Sources: Jakarta Post; Vietnam Plus)

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