Bambang Ismoyo, Jakarta – Two major electric vehicle (EV) projects in Indonesia – by Vietnam's VinFast and China's BYD – are facing disruptions allegedly caused by local civic groups, or ormas, raising red flags over the country's investment climate.
Deputy Speaker of the People's Consultative Assembly (MPR) Eddy Soeparno recently took to social media to voice concerns over reports of thug-like behavior by these groups. According to Eddy, the disturbances have interfered with BYD's plant construction in Subang, West Java, and he called on the government to respond firmly to prevent further harm to the investment ecosystem.
BYD, which entered the Indonesian market last year, is currently building a major manufacturing facility in the Subang Smartpolitan industrial estate. The company has secured a 126-hectare plot to develop a factory capable of producing up to 150,000 EV units annually.
VinFast, which is also setting up shop in Subang, is facing similar obstacles. Moeldoko, chairman of the Indonesian Electric Vehicle Industry Association (Periklindo), confirmed that VinFast has reported disruptions during the construction of its $200 million (Rp3.38 trillion) factory. The facility, built on a 170-hectare plot, is scheduled to begin operations by late 2025 and will assemble the company's VF 3 electric model.
The Investment Ministry has pledged to investigate the matter. Nurul Ichwan, Deputy for Investment Promotion at the ministry, said the government is engaging directly with BYD's management to better understand the situation.
"These cases of intimidation and extortion are not just disruptive, they're damaging to Indonesia's global image as a safe and attractive place to invest," Nurul told reporters in Jakarta on Wednesday.
He warned that if the reports are true, a special government task force will be deployed to address the issue swiftly.
Indonesia is currently vying to become a major hub for green manufacturing, including electric vehicles, and has launched aggressive campaigns to attract foreign investment. However, disruptions by ormas could threaten the country's ambitions.
"We must not let investors withdraw from Indonesia, abandon their projects, and shut the door on job opportunities for thousands of our people who could have been employed there," he said.
According to the Indonesian Industrial Estate Association (HKI), disturbances by such groups have cost the country hundreds of trillions of rupiah in unrealized investments. These groups are known to block access to project sites, stage protests, and demand control over services like transportation, catering, and procurement.
Source: https://jakartaglobe.id/business/vinfast-byd-projects-in-indonesia-face-disruptions-from-local-group