Will Indonesia finally win Elon Musk’s help to realise its EV dreams?
- President Joko Widodo has for years been wooing the Tesla and SpaceX CEO to invest in his nickel-rich country, which is seeking to grow its electric vehicle sector
- But Indonesia must drive up its sustainability profile and offer investment incentives if it wants to have an edge over regional contenders like Malaysia, analysts say
When Indonesian President Joko Widodo visited the US last week, it wasn’t his talks with US President Joe Biden that generated the most buzz back home, but his long-anticipated meeting with the world’s wealthiest man and electric vehicle (EV) titan Elon Musk.
Jakarta has for years been trying to woo Musk, the CEO of electric carmaker Tesla and aerospace company SpaceX, to invest in the country since it set its sights on developing the region’s biggest EV industry. Its hopes were further buoyed when the billionaire was last year said to be keen to build a launch site on one of Indonesia’s remote islands.
“[This meeting] is a follow-up of my instruction to the coordinating minister of investment affairs to talk to Elon about investment, technology and innovation,” said Widodo at SpaceX’s Stargate building in Texas.
Musk said he would try to visit Indonesia in November, around the time it would be hosting the G20 Summit on resort island Bali. He noted that Indonesia, with its steady economic growth and Southeast Asia’s largest population of 270 million people, had “tremendous potential” and he would “look closely from the Tesla and SpaceX standpoint to try to do some partnerships”.
Any deal with Musk would propel Indonesia into the global EV industry’s supply chain, which is expected to continue growing as carmakers race to cut carbon emissions.
The country also stands to gain from its status as the world’s largest producer of nickel, a key material in EV batteries. With 21 million metric tonnes of nickel in store, Indonesia has more reserves of the metal than next-largest producers Australia and Brazil combined.
But to win the growing regional battle for Tesla’s favour, Indonesia has to raise its environmental, social, and corporate governance (ESG) profile and establish incentives including tax breaks – particularly as neighbouring Malaysia seeks to build its own EV sector, analysts say.