Tesla is considering setting up a battery plant in Indonesia, where a lot of nickel is minedTesla is considering setting up a battery plant in Indonesia, where a lot of nickel is mined

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Tesla is considering setting up a battery plant in Indonesia, where a lot of nickel is mined

Tesla expects to become the dominant electric vehicle maker in a few years by aggressively increasing its traction battery production and negotiating with suppliers. Indonesian authorities have confirmed that Tesla is interested in building a battery manufacturing facility in the country.

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CNBC Indonesia reported this with reference to the comments of the Indonesian ministers. Back in September, the head of one of the Indonesian ministries confirmed that Tesla representatives contacted him by phone to study the possibility of organizing the production of traction batteries in this country. Along the way, the issue of quotas for raw materials was studied, and local authorities said that provided the Tesla enterprise appears in Indonesia, the company will be able to count on certain guarantees for the supply of nickel.

Indonesia is one of the largest suppliers of nickel in the world market but is now trying to attract investors for the construction of local processing plants, while simultaneously reducing the export of unprocessed nickel. On the one hand, Tesla is now trying to reduce the use of nickel in its battery production, but the company’s needs are constantly growing, and another source of components will definitely not hinder it in the future. On the other hand, Indonesia has so far faced environmental claims due to the inadequate use of mining waste. It is possible that Tesla will have to radically revise its local nickel mining practices in order to raise the production culture at the local enterprise to the general corporate standards.

The Indonesian authorities are doing their best to attract foreign investors to the Batang region in the north of Java to organize assembly plants there, transferred from China. From a logistics point of view, Tesla will not be very convenient to produce batteries on this island, but these are the requirements of local laws – without local production, the company will not be able to count on sufficient quotas for nickel consumption. Tesla’s strategy usually involves building a battery manufacturing facility on the same site as a car assembly plant, but whether the brand’s electric vehicles will be assembled in Indonesia is a big question.

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