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The
investment is Ford's first in the Southeast Asian country and
underscores growing appetite among automakers for raw materials
used in producing electric vehicle (EV) batteries, which account
for about 40% of a vehicle's sticker price, aiming to cut costs
and close the gap on EV market leader Tesla.
Volkswagen, Europe's biggest automaker, this month said that it
would invest 180 billion euros ($196 billion) over five years in
areas including battery production and the sourcing of raw
materials.
Indonesia, which has the world's biggest nickel reserves, has
been trying to develop downstream industries for the metal,
ultimately aiming to produce batteries and electric vehicles.
The proposed high-pressure acid leaching (HPAL) plant will be
located in Pomalaa in Southeast Sulawesi, where Vale operates a
nickel mine.
Vale and Huayou began construction of the plant in November and
commercial operation is expected to start in 2026.
Febriany Eddy, chief executive of Vale Indonesia, said the deal
is unique in bringing the U.S. automaker into an upstream nickel
business.
She said that Vale has a 30% stake in the project, with the
remainder being controlled by Ford and Huayou.
The companies did not say how much Ford will invest in the
plant, which is expected to produce 120,000 tonnes per year of
mixed hydroxide precipitate, a material extracted from nickel
ore for use in EV batteries.
"Ford can help ensure that the nickel that we use in electric
vehicle batteries is mined, produced within the same ESG
standards as part of our business around the world," Christopher
Smith, Ford's chief government affairs officer, said at the
signing ceremony.
Indonesia's government has banned exports of unprocessed nickel
ore since 2020 to ensure supply for existing and potential
investors while it also courts global EV makers such as Tesla
and China's BYD Group to invest in the country.
($1 = 0.9205 euros)
(Reporting by Gayatri Suroyo; Editing by Martin Petty and David
Goodman)
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