Saturday, August 12, 2023

"Musk still mulling massive Tesla plant for Indonesia"

As well he should. Indonesia as both a raw material supplier and value-chain extender is a win for Tesla and a win for Indonesia. Throw in the benefits of a developing market for the end product and Tesla would be foolish to only build the Malaysian plant.

As we've tried to emphasize for the last couple years, resource nationalism is real and the desire of resource-rich countries to be left with something more than a hole in the ground for their efforts is the story of this decade and beyond.

From Asia Times, August 9:

Investment of at least $1 billion on the table as world’s richest man heads to island nation for what could be make or break talks  

JAKARTA – Taken aback by Elon Musk’s decision to use Malaysia as Tesla Inc’s Southeast Asia base, Maritime Affairs and Investment Coordinating Minister Luhut Panjaitan remains cautiously optimistic the world’s richest man will still invest in Indonesia’s ambitious electric vehicle (EV) supply chain. 

After a low-key, two-and-a-half-hour August 3 meeting in San Francisco, which went on twice as long as expected, the multi-billionaire carmaker is said to have agreed to make a final decision on building a manufacturing plant by the end of the year.

Learning from past mistakes, when they annoyed Musk by making premature statements about his plans for Indonesia, Panjaitan and his negotiating team have said very little publicly about the outcome of the hastily arranged meeting.

A source close to Panjaitan said Musk was “very open about what he thinks” regarding Tesla and SpaceX, his spacecraft venture which has previously been offered an equatorial launch site on Biak island, off the northern coast of Papua....


Recently on the mating game:

July 29's: "Uh Oh: "Indonesia blindsided by Musk snub on Tesla plant":

Elon better get this right. Maybe, if the Indonesian government actually gets going on the project to shift the capital to Borneo Mr. Musk could be something of an employment anchor, but whatever he does he should make amends to Indonesia....

August 1: "Indonesia's new capital aims to be 'economic growth center'"  

And more generally, see also February 2023's "Nickel shows Indonesia how to escape the middle income trap"  which focuses on resource nationalism and includes a comment on Serbia's giant lithium deposit.