Hyundai and LG are set to begin a joint venture in which the giants plan to build an electric vehicle battery plant in Indonesia, as reported by Forbes. The geographic location of the plant can benefit from the vast consumer market in Southeast Asia and also the rich supply of nickel.
Both the companies will have equal participation in the venture and the battery plant will be set up in Indonesia’s West Java province. The building of the plant will begin this year and the plant will begin its operation by 2024. It is expected to produce almost 10-gigawatt hours of battery cells every year, as stated by Hyundai.
The statement explains that both the companies can produce 150,000 battery-run electric vehicles with the capacity of the plant. Hyundai expects that it will help the company and its subsidiary Kia to “secure a stable supply of EV batteries at a competitive price”. The price is partly due to the rich supply of natural nickel in Indonesia. It is now the second-largest producer of nickel in the world. Nickel laterite ore is used as an ingredient in lithium battery.
More investments are coming into Indonesia with an eye for its nickel. The nickel projects here costs less than that of Australia and Canada.
The EV production of Hyundai was affected by the lack of cell supplies. With this joint venture, Hyundai expects to grow its EV market. LG has been supplying batteries through its LG Energy Solutions to General Motors and Tesla. Therefore, LG will also benefit from this venture.