Indonesia EV Battery Market (2026-2036)

The Indonesia EV Battery Market comprises lithium-ion and other batteries produced or supplied in Indonesia for electric vehicles, including battery cells, modules, and packs for battery electric vehicles, plug-in hybrid vehicles, and hybrid vehicles, electric two- and three-wheelers, and electric buses and commercial vehicles, for both domestic use and export. The market covers nickel-based NMC and NCA chemistries, LFP, and emerging chemistries such as sodium-ion and LMFP. Market value is measured at the cell, module, and pack level; upstream nickel mining and processing, precursors, and cathode materials are analyzed as part of the value chain but excluded from market value. The ecosystem spans nickel miners and smelters, battery materials producers, cell manufacturers, pack assemblers, automakers, two-wheeler makers, the state-owned Indonesia Battery Corporation, and government agencies.

Indonesia's battery ambitions are built on nickel. Indonesia produces more than half of the world's mined nickel, according to the U.S. Geological Survey, and banned the export of nickel ore from January 2020 to encourage domestic processing, leading to a rapid build-out of nickel smelters and high-pressure acid leaching plants, largely financed and operated by Chinese companies in industrial parks such as Morowali in Central Sulawesi and Weda Bay in North Maluku. The government established the state-owned Indonesia Battery Corporation, which includes PT Aneka Tambang and MIND ID, to develop a domestic battery supply chain from mining to cells.

The market has also faced setbacks and structural challenges. In April 2025, LG Energy Solution withdrew from the Rp 142 trillion (about USD 8.45 billion) Indonesia Grand Package, signed in late 2020, citing market conditions and the investment environment, drawing criticism from the Energy and Mineral Resources Ministry, although the government stated the withdrawal would not affect its nickel downstreaming agenda. The global shift toward LFP batteries, which do not use nickel, environmental concerns about coal-powered nickel processing, and a domestic electric vehicle market that remains small relative to total car sales add uncertainty, while automakers such as Hyundai, BYD, VinFast, and Wuling are localizing electric vehicle production.

In 2026, West Java is expected to account for the largest share of the Indonesia EV Battery Market. The province's dominance is supported by its concentration of battery cell plants and automotive manufacturing. Karawang hosts HLI Green Power's cell plant, launched in 2024 with up to 10 gigawatt-hours of capacity, and the CATL joint venture cell plant, which broke ground in June 2025 and is scheduled to begin operation by the end of 2026 with 6.9 gigawatt-hours, expanding to 15 gigawatt-hours. West Java's industrial corridor, including Karawang, Bekasi, and Subang, is home to major automotive assembly plants, including Hyundai's electric vehicle production and new plants by Chinese and Vietnamese automakers.

However, Central Java is projected to register the highest CAGR during the forecast period. The rapid growth of the province is attributed to its development as an industrial location with large integrated industrial estates, including the Batang Integrated Industrial Estate, which the government has promoted for electric vehicle battery and related investments, and lower labor costs than the West Java corridor. As Indonesia seeks to attract new battery, materials, and electric vehicle investments to replace projects such as the Rp 142 trillion Indonesia Grand Package from which LG Energy Solution withdrew in April 2025, Central Java is positioned to host new facilities.

Sulawesi is expected to account for a significant share of upstream activity supporting the battery market. Central Sulawesi's Morowali Industrial Park and Southeast Sulawesi's Pomalaa area host large nickel smelting and high-pressure acid leaching operations producing battery-grade nickel intermediates, largely developed by Chinese companies, and some of Indonesia's largest nickel mines, supporting Indonesia's position as the producer of more than half of the world's mined nickel. Battery materials production in Sulawesi feeds precursor and cathode supply chains that may increasingly serve Indonesian cell plants. The Indonesia Morowali Industrial Park, developed from 2013 with Chinese investment, has become one of the world's largest nickel processing centers, and the nickel ore export ban in January 2020 accelerated the construction of smelters and high-pressure acid leaching plants in the province.

North Maluku is expected to register strong growth as a battery materials hub. The Weda Bay Industrial Park on Halmahera hosts major nickel processing operations, and the CATL project, which broke ground in June 2025, includes nickel mining, smelting, and precursor production in East Halmahera in an integrated battery industrial park valued at USD 4.7 billion, planned to include solar power and waste heat recovery. North Maluku's nickel will supply the CATL project's cell plant in Karawang, linking the province to cell production. The Weda Bay Industrial Park, developed from 2018, has become a major nickel processing hub, and the CATL project's nickel sourcing from East Halmahera links North Maluku directly to the 15-gigawatt-hour cell plant in Karawang.

The Riau Islands, including Batam, and other regions are expected to account for smaller shares of the market. Batam's special economic zones and proximity to Singapore make it a location for electronics and battery pack assembly and energy storage projects, while other provinces in Java, Sumatra, and Kalimantan host motorcycle and vehicle assembly and could attract battery pack production as electric two-wheeler adoption grows, supported by electric motorcycle subsidies and a motorcycle fleet of well over 100 million. The IDR 7 million electric motorcycle subsidy introduced in 2023 supports demand in regional markets across Java, Sumatra, and Kalimantan, where motorcycles are the dominant form of transport.