Indonesia's president: wants Tesla to build cars locally, not just batteries

Indonesia wants Tesla Inc. to build electric cars in the country, not just batteries, and is willing to take the time to convince Elon Musk to see it as a resource-rich treasure trove.

We want complete electric cars, not just batteries," Indonesian President Joko said in an interview Thursday. For Tesla, we want them to build electric cars in Indonesia. We want to create a huge electric car ecosystem."

Joko said he has similar expectations for automakers such as Ford, Hyundai, Toyota and Suzuki. That suggests he is interested in seeking investment and making sure Indonesia does not fall into the role of a raw material supplier or parts maker in the global electric vehicle supply chain.

With nearly a quarter of the world's nickel reserves, Indonesia has emerged as a major battery producer in recent years. That makes it an attractive investment destination, with car and battery makers, including Tesla, heading to the country in search of battery materials.

When asked about what's holding up a deal with Tesla, Joko said, "We are still in discussions. It takes time to do anything. I don't want to give up quickly, it requires intensive communication and the results will be visible soon."

An Indonesian official said in May that the country was arranging a meeting between the president and Musk to discuss a potential investment. In addition, Tesla's team has visited several sites in Indonesia. Musk said he is considering a visit to Indonesia in November to explore investment opportunities, according to a May statement from Joko's office.

For several years, the Indonesian government has been in talks with Musk's team about potential partnerships, including a partnership with Tesla to develop electric cars and the possibility of a SpaceX rocket launch site in the country. However, no agreement has yet been reached in these negotiations.

Indonesia is home to many of the world's largest deposits of copper, nickel and tin. While most of Indonesia's nickel has so far been exported to steel mills in China and elsewhere as an intermediate material, the Joko government is now keen to reposition the country as an electric car and battery hub.