Automobile giant Ford has teamed up with Vale Indonesia and China’s Zhejiang Huayou Cobalt to invest in a $4.5 billion nickel processing plant in Indonesia.
This marks Ford’s first investment in the Southeast Asian country and demonstrates the increasing interest among automakers in raw materials used in producing electric vehicle (EV) batteries, which account for about 40 percent of a vehicle’s cost. The investment aims to reduce costs and catch up with EV market leader Tesla.
Europe’s largest automaker, Volkswagen, recently announced it would invest 180 billion euros ($196 billion) over five years in areas including battery production and sourcing of raw materials.
Indonesia has the world’s largest nickel reserves and is looking to develop downstream industries for the metal, eventually producing batteries and EVs.
Ford said the high-pressure acid leaching (HPAL) plant will be located in Pomalaa in Southeast Sulawesi, where Vale operates a nickel mine. Vale and Huayou began building the plant in November and expect commercial operations to start in 2026.
Vale holds a 30 percent stake in the project, with the remainder controlled by Ford and Huayou. The amount Ford will invest was not disclosed. The plant is expected to produce 120,000 tons per year of mixed hydroxide precipitate, a material extracted from nickel ore for use in EV batteries.