Tesla reaches $5 billion purchase agreement with Indonesian nickel processing company

U.S. electric car maker Tesla has signed a contract worth about $5 billion to buy electric vehicle battery materials from an Indonesian nickel processing company, Indonesian officials said Monday.

Tesla has signed a five-year contract with the nickel processing company on Sulawesi Island in Morowali regency to buy nickel for batteries, Indonesian Coordinating Minister for Maritime and Investment Affairs Luhut Pandjaitan said in a media interview on Monday.

We are still in ongoing negotiations with Tesla ...... but they have started buying two excellent products from Indonesia.

Indonesia has significant nickel resources and so far most of the nickel investment has been in the production of crude metals such as nickel pig iron and ferronickel. The country has been trying to attract Tesla to set up production facilities there. Indonesian President Joko - met with Tesla CEO Elon Musk earlier this year to attract investment.

The Indonesian government is committed to developing the electric vehicle and battery industries in the country and has halted exports of nickel ore to ensure availability to investors. A partnership with Tesla would be beneficial in achieving Indonesia's ambitious goal of energy transition through the electric vehicle industry. Indonesia has already received billions of dollars in investment from manufacturers in the electric vehicle industry as incentive policies continue to be put in place.

A South Korean consortium led by LG, the world's second largest battery maker, previously invested about $9 billion in battery supply chain (from mining to manufacturing) projects in Indonesia. LG Energy and Hyundai Motor Group began construction of a battery joint venture plant in Indonesia last year, which is expected to be operational by 2024.

In addition, global power battery leader Ningde Times Holdings subsidiary recently signed a tripartite agreement with PT Aneka Tambang (ANTAM) and PT Industri Baterai Indonesia (IBI) in Indonesia. The three companies will invest in the construction of power battery industry chain projects in FHT Industrial Park in East Hamahara District, North Maluku Province, Indonesia and other related industrial parks in Indonesia. The total investment amount of the project has been determined to be no more than USD 6 billion, with a planned construction cycle of five years.

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John Murphy

John Murphy is the founder of TOPCARS Tesla Aftermarket Accessories, as well as an investor in Tesla and owner of the Model Y. He posts about Tesla news while running the site on a daily basis.

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