Tesla is said to be close to signing an agreement with Indonesian authorities to build the company’s fifth automobile factory. This is according to Bloomberg, which points to sources who should know about the plans.
The aim is said to be a factory that can produce 1 million cars a year. One of the important reasons why it was built in Indonesia is the country’s mineral resources. Indonesia has large reserves of nickel and cobalt. There are also reserves of lithium in the country.
The authorities’ discussions with Tesla will concern, in addition to a car factory, a number of different facilities in the country related to car production.
So far, no agreement has been signed, and therefore it is not certain that there will be anything from Tesla’s Indonesian factory. But, Indonesian Investment Minister Bahlil Ladalia confirmed that talks are ongoing, Bloomberg writes.
The country’s president, Joko Widodo, had earlier expressed his desire for the US automaker to produce cars in the country – after Tesla signed contracts to buy nickels from Indonesian firms last year.
Low car prices
Although Indonesia may be an attractive country to manufacture cars in, it is not taken for granted that it is an immediately logical location. The Tesla factory was built in Germany to supply cars to the European market. Their factory in China produces many cars for export, but also covers the Chinese market.
However, Southeast Asia is a very different market than Europe and China. According to Bloomberg, the average new passenger car price in the region is under $20,000. That’s about half of the cheapest Tesla Model Y costs in China.
However, Tesla has given signs that it plans to produce a much cheaper car in the $25,000 price range, which will likely be able to sell better in Southeast Asia.
Working with the new generation of electric vehicle platform
The company has indicated on several occasions that it is working on a new automotive platform. During a presentation of quarterly numbers this fall, Tesla leader Elon Musk said they’re working on a new car platform that will cost half as much as existing platforms to produce.
Tesla recently announced that it will introduce its third-generation electric vehicle platform during its Investors Day on March 1.
It is also known that Tesla is also in talks with the authorities of other countries. During his talks with the South Korean president this fall, Musk reportedly said the country is a very topical candidate for a new plant in Asia. In addition, Tesla is known to be in talks with authorities in Canada.
“Web specialist. Lifelong zombie maven. Coffee ninja. Hipster-friendly analyst.”
