LG Energy Solution Withdraws from $8.45 Billion EV Battery Project in Indonesia

South Korea’s LG Energy Solution (LGES) has officially pulled out of a multibillion-dollar electric vehicle battery project in Indonesia valued at approximately $8.45 billion (Rp 142 trillion). The announcement was made on Monday, April 21, 2025.

The project, known as the Indonesia Grand Package, was established through a partnership agreement signed in late 2020 between LGES and the Indonesian government. The initiative aimed to build a comprehensive supply chain for electric vehicle batteries in Southeast Asia’s fastest-growing EV market.

“After evaluating various factors, including market conditions and the investment environment, we have decided to formally withdraw from the Indonesia Grand Package project,” LGES said in an official statement quoted by Reuters.

Continued Commitment to Joint Ventures

Despite the withdrawal, LGES affirmed its ongoing commitment to collaborate with the Indonesian government, particularly through its joint venture HLI Green Power—co-led with Hyundai Motor Group.

HLI Green Power inaugurated Indonesia’s first EV battery cell plant last year, with an annual production capacity of 10 gigawatt hours and plans for further expansion in the next investment phase.

Indonesian Government Remains Confident

In response to LGES’s exit, the Indonesian government maintained a positive outlook on the future of its domestic battery industry. Tri Winarno, Director General of Mineral and Coal at the Ministry of Energy and Mineral Resources, stated that Indonesia would continue to seek new foreign partners to develop its battery sector, leveraging the country’s vast nickel reserves.

“Even with LG pulling out, we believe Indonesia’s nickel remains highly competitive globally,” Tri told reporters.

Meanwhile, state-owned mining company Aneka Tambang (Antam), which had planned to partner with LGES in nickel mining operations, reiterated its commitment to supplying battery-grade nickel through alternative partnerships. Indonesia Battery Corporation (IBC), another state firm previously eyeing cooperation with LGES, has not issued an official statement on the matter.