LG Withdraws $8.45 Billion EV Battery Investment in Indonesia Citing Global Market Shift
South Korean electronics giant LG has officially withdrawn from the Grand Package (GP) investment project in Indonesia, a major initiative initially agreed upon at the end of 2020. The project, valued at Rp 142 trillion (approximately USD 8.45 billion), aimed to establish a complete supply chain for electric vehicle (EV) batteries in the country.
According to a report from Reuters on Monday, April 21, 2025, LG cited changes in global market conditions and the current investment climate as the main reasons behind its decision to exit the project.
“After considering various factors, including market conditions and the global investment environment, we have agreed to officially withdraw from the GP (Grand Package) Indonesia project,” the company said in an official statement.
Despite stepping back from the GP project, LG emphasized its commitment to continuing collaboration with the Indonesian government through other ventures. “We will continue to explore various ways to maintain cooperation with the Indonesian government, particularly through the HLI Green Power joint venture,” the statement added.
HLI Green Power is a joint venture between LG Energy Solution (LGES) and Hyundai Motor Group. Last year, the venture inaugurated Indonesia’s first EV battery cell production facility. The plant has an annual production capacity of 10 gigawatt-hours and plans are underway to expand output in a second phase of investment.
The withdrawal was largely driven by a shifting landscape in the EV industry, marked by a temporary slowdown in global demand for electric vehicles. A representative from LG Energy Solution, quoted by Yonhap News Agency, confirmed, “Given the current market and investment environment, we have decided to exit the project.”
However, LG made it clear that its broader investments in Indonesia will continue. This includes its involvement in the Hyundai LG Indonesia Green Power battery factory, which is seen as a cornerstone of the country’s EV ambitions.
“We will continue our existing business operations in Indonesia, such as the Hyundai LG Indonesia Green Power battery plant, our joint venture with Hyundai Motor Group,” LG concluded.
