BUSINESS

Indonesia Signals Peak in Nickel Mining Investment as Focus Shifts to Batteries, EVs

Published: Dec. 9, 2025 2:36 p.m. GMT+8

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A nickel mine in Southwest Papua province, Indonesia, on Sept. 24. Photo: VCG

Indonesia’s nickel mining boom has likely crested, shifting the resource-rich nation’s focus toward downstream battery production and electric vehicles (EVs), a senior government official said.

Septian Hario Seto, an economist and a member of Indonesia’s National Economic Council, told the DBS Metals & Mining Indonesia Forum in late November that the rapid pace of capital injection into upstream nickel extraction is settling down. The key task now is capitalizing on the processing capabilities built over the last few years, he said.

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Indonesia’s nickel mining boom has plateaued; focus shifts to downstream EV and battery sectors, targeting President Prabowo’s 8% growth goal.
Indonesia leads globally in nickel output (65-70%), is second in anode materials (160,000 tons), and ranks third in cathode/precursor materials.
EV investment is rising, with BYD and GAC expanding; regulatory reforms aim to boost labor-intensive industries, though workforce skills lag regional peers.

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Who’s Who

BYD Co. Ltd.: BYD Co. Ltd. is constructing a $1.3 billion electric vehicle (EV) plant in Indonesia, aiming for an annual capacity of 150,000 vehicles, with production expected to begin in 2026. The Chinese automaker led EV sales in Indonesia during the first 10 months of 2025, selling approximately 31,000 units.

Guangzhou Automobile Group Co. Ltd.: Guangzhou Automobile Group Co. Ltd. (GAC) is expanding its local capacity in Indonesia. The company plans to increase its production capacity from 20,000 to 50,000 units. This expansion is part of a broader trend of major automakers ramping up local operations to utilize Indonesia's growing supply chain for electric vehicles.

VinFast: VinFast, a Vietnamese automaker, is planning to establish an electric vehicle factory in Indonesia. This factory is expected to have a similar capacity to BYD's new plant, producing around 150,000 vehicles annually, and is also slated to commence production in 2026.

Toyota Motor Corp.: Toyota Motor Corporation led the combustion-engine car market in Indonesia, holding 30% of sales during the first 10 months of the year. While Toyota dominates the traditional market, Chinese brands are making inroads into the nascent EV sector.

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