Vietnam’s automotive company, VinFast, has committed to a significant investment in Indonesia, focusing on the construction of an electric vehicle (EV) manufacturing plant in Subang, West Java. This initial investment is valued at Rp 4 trillion (approximately US$266 million based on March 2025 exchange rates).
The announcement was made by the Indonesian Investment Minister/Head of the Investment Coordinating Board (BKPM), Rosan Roeslani, following a meeting between VinFast executives and Indonesian President Prabowo Subianto. Minister Roeslani stated, “They are investing in electric cars in Subang on 120 hectares of land. They plan to produce 50,000 vehicles per year, with an investment reaching Rp 4 trillion.”
The planned factory, spanning 120 hectares, is slated to produce 50,000 vehicles annually. This ambitious project is expected to commence construction shortly after the completion of Ramadan in Indonesia. The targeted completion date for the factory is 2026, with production commencing the same year.
The planned vehicle range is expected to cover various models, targeting a price range from Rp 200 million to Rp 600 million. Minister Roeslani emphasized the government’s commitment to supporting and accelerating the construction process to ensure smooth implementation and positive local impact. The Indonesian government’s proactive approach is aimed at facilitating a streamlined process for the investment.
Thousands of Jobs Created
VinFast’s Subang plant is projected to create between 1,000 and 3,000 direct jobs. This figure excludes indirect employment opportunities across supporting industries, including component suppliers, logistics, and infrastructure development. The substantial employment potential represents a significant boost for the local economy.
With a production target of 50,000 units annually, the demand for skilled labor in manufacturing and technology will increase considerably. This surge in job creation will contribute positively to Indonesia’s unemployment rate reduction. The project also promises to stimulate economic growth within the region.
Furthermore, VinFast plans to establish 30,000 to 100,000 charging stations across Indonesia. This extensive charging infrastructure project will generate additional employment opportunities within the renewable energy and electric vehicle support sectors. This comprehensive approach shows a commitment to a complete EV ecosystem.
Developing Supporting Industries
The Rp 4 trillion investment will have a substantial ripple effect on the Indonesian economy. Beyond job creation, it will stimulate growth in supporting industries like automotive components, logistics, and renewable energy. This will enhance Indonesia’s competitiveness in the global automotive market and attract further foreign investment.
VinFast’s commitment extends beyond the manufacturing plant. They have already introduced the Xanh SM electric transportation service in several Indonesian locations, offering eco-friendly electric taxis. This demonstrates VinFast’s broader commitment to building an integrated electric vehicle ecosystem in the country.
The Indonesian government wholeheartedly supports VinFast’s investment. Minister Roeslani highlighted its alignment with the government’s industrial downstreaming efforts and its appeal to foreign investment. The government’s full support underscores its dedication to accelerating the plant’s construction for rapid positive community impact.
The collaborative effort between VinFast and the Indonesian government is poised to yield substantial economic benefits for Indonesia and strengthen bilateral ties between Indonesia and Vietnam. This partnership also promises to enhance economic cooperation between the two nations across multiple sectors. Minister Erick Thohir aptly summarized the positive impact, stating, “This means it will open up jobs for the Indonesian people. This is extraordinary.”
The Arrival of the Electric Vehicle Era in Indonesia
VinFast’s investment marks a significant step towards establishing a robust electric vehicle industry in Indonesia. The creation of thousands of jobs, the development of supporting industries, and the expansion of charging infrastructure all contribute to a positive economic outlook. The potential for technology transfer and skills development will further enhance Indonesia’s human capital.
The project’s success hinges on a synergistic partnership between VinFast and the Indonesian government. The government’s commitment to facilitating the investment process, combined with VinFast’s substantial investment, positions Indonesia favorably for a transition towards a more sustainable and technologically advanced automotive sector. The long-term benefits for both nations are considerable and extend beyond economic growth.
In conclusion, VinFast’s investment represents a significant boost for Indonesia’s economy and its transition to electric vehicles. The project’s scale and the government’s support highlight a promising future for the Indonesian automotive industry and bilateral relations with Vietnam.
