Toyota to invest $2 billion in developing EVs in Indonesia

2 min readUpdated May 26, 2025Dec 2, 201911:00 PM

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Toyota Motor Corp. plans to invest $2 billion to develop electric vehicles in Indonesia over the next four years, starting with hybrid vehicles, Indonesia’s coordinating minister for maritime affairs said.

“From 2019 to 2023, we will progressively increase our investment to 28.3 trillion rupiahs ($2 billion),” Toyota president Akio Toyoda was quoted as saying in a statement released by the ministry on Thursday.

Toyota said this month that it aimed for half its global sales to be from electric vehicles by 2025, five years ahead of schedule, and will tap Chinese battery makers to meet the accelerated global shift to electric cars.

The deal was agreed at a meeting in Osaka on Thursday between Indonesia’s Coordinating Minister for Maritime Affairs Luhut Pandjaitan and Toyoda.

“Because the Indonesian government already has an electric vehicle development map, Toyota considers Indonesia a prime EV investment destination,” Toyoda said in the statement.

He said Toyota would follow the government’s EV plan by investing in stages, starting with the development of hybrid vehicles.

Monet, the self-driving car joint venture of Toyota and SoftBank Corp., separately told Reuters in June it plans to begin operating in Southeast Asia next year

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Indonesia, the region’s largest economy, has plentiful reserves of nickel laterite ore, a vital ingredient in the lithium-ion batteries used to power EVs, and has been making a push to attract foreign carmakers.

“Because the Indonesian government already has an electric vehicle development map, Toyota considers Indonesia a prime EV investment destination,”

Officials are betting Indonesia, which is already Southeast Asia’s second-largest car production hub, can become a major regional player in lithium battery production and feed the fast-rising demand for EVs.

The country announced earlier in 2019 plans to introduce a financial program that will offer tax cuts to EV battery producers and automakers, as well as preferential tariff agreements with other countries that have a high EV demand.

Indonesian ministers told Reuters in December that Korean carmaker Hyundai Motor Co. plans to start producing EVs in Indonesia as part of an around $880 million auto investment in the country.

Mitsubishi, meanwhile, announced in mid-2018 it would work with the Indonesian government to research infrastructure that could accommodate EVs.

Analysts are cautious however on how quickly Indonesia’s EV ambitions can be carried out, as some of its lithium battery projects require complicated nickel smelter technology.

The ministry’s statement on Thursday gave no details on how Toyota, which already makes batteries for hybrids and hybrid plug-ins, would implement its investment plans.

Toyota was not immediately reachable for comment, but said in June it would partner with China’s Contemporary Amperex Technology Co. and EV maker BYD Co. for battery procurement.

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Questions & Answers

What is the total investment amount and the timeframe for Toyota's electric vehicle development in Indonesia?

Toyota plans to invest $2 billion in Indonesia, or 28.3 trillion rupiahs. This investment will take place over four years, from 2019 to 2023, for developing electric vehicles.

Why does Toyota consider Indonesia a suitable location for this electric vehicle investment?

Toyota views Indonesia as a prime EV investment destination because the Indonesian government already has a detailed electric vehicle development map, which Toyota plans to follow in stages.

What is Indonesia's strategic advantage in the electric vehicle industry, and what plans does it have to attract investment?

Indonesia possesses significant reserves of nickel laterite ore, crucial for lithium-ion batteries. The country plans to offer tax cuts to EV battery producers and automakers, alongside preferential tariff agreements with countries showing high EV demand.

Which specific types of electric vehicles will Toyota initially focus on developing as part of this investment?

Toyota will begin its investment in stages by focusing on the development of hybrid vehicles. This is an initial step within its broader plan to develop electric vehicles in Indonesia.

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