- The LG-led consortium cancelled its US$7.7 billion EV battery project in Indonesia due to a slowdown in global demand.
- LG will continue operating the HLI Green Power plant with Hyundai, Southeast Asia’s largest EV battery facility.
A South Korean consortium led by LG announced the cancellation of its electric vehicle (EV) battery supply chain project in Indonesia on Friday, April 18, 2025. The cancelled initiative, valued at 11 trillion won (approximately US$7.7 billion or Rp129 trillion), was set to establish a full-scale supply chain for EV batteries in the resource-rich Southeast Asian nation.
The consortium included LG Energy Solution, LG Chem, LX International Corp., and other companies. These companies had worked with the Indonesian government and state-owned enterprises to build a complete EV battery supply chain.
The project aimed to cover the full process, from raw material sourcing to making precursors, cathodes, and battery cells. Indonesia is the world’s largest nickel producer, a key material for EV batteries.
An LG Energy Solution executive explained that the decision followed consultations with Indonesian authorities and cited shifting market dynamics, particularly the current slowdown in global EV demand, referred to as the ‘EV chasm’, as a key factor in the withdrawal.
“Taking into account various factors, including market conditions and the investment environment, we have agreed to formally withdraw from the Indonesia GP (Grand Package) project,” the executive said in a statement.
Despite pulling out of the Grand Package, LG Energy Solution confirmed it would continue its existing operations in Indonesia. The official added, “We remain committed to our joint venture with Hyundai Motor Group, HLI Green Power.”
Located in Karawang Regency, West Java, HLI Green Power is Southeast Asia’s first and largest EV battery cell plant. President Joko Widodo inaugurated the facility on July 3, 2024. The project represents a separate investment worth US$3.1 billion (around Rp45.88 trillion), previously integrated with the Grand Package framework.
The Karawang-based plant was developed in two phases. The first phase, which began commercial production in April 2024, cost US$1.1 billion (approximately Rp16.28 trillion) and has a capacity of 10 GWh. The second phase, launched in January 2024 with a further US$2 billion investment (Rp29.6 trillion), started commercial operations in March 2025, adding another 20 GWh in capacity, bringing the total to 30 GWh.
PT HLI Green Power is a joint venture between Hyundai Motor Company, LG Energy Solution, and PT Indonesia Battery Corporation (IBC). This collaboration stems from a memorandum of understanding signed on July 28, 2021, between the consortium and Indonesia’s Ministry of Investment (BKPM).
Although LG and its partners have abandoned the larger supply chain project, their continued investment in battery manufacturing signals sustained interest in Indonesia’s role within the global EV ecosystem, albeit with more cautious and targeted engagement amid uncertain market conditions.