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Toyota plans to invest $2 billion in electric vehicles in the country over the next four years, starting with plug-in hybrid models, according to reports.

Indonesian Ocean Co-ordination Minister Luhut and Akio Toyoda reached the above cooperation agreement at a meeting in Osaka, Japan. Toyota will be from 2019 to 2023. We will gradually expand our investment to US $2 billion for the development of new energy vehicles. Toyota's overall investment project will start with plug-in hybrid models and gradually shift to pure electric models.

Earlier this month, Toyota announced an upgrade to its electrification strategy, planning that by 2025, half of its global sales would come from electric vehicles, five years ahead of schedule, and would purchase batteries from Chinese manufacturers to meet the need for an accelerated global shift to electric vehicles.

Toyota chose to invest in new energy vehicle research and development projects in Indonesia for the following reasons: first, Indonesia has entered the development stage of the new energy vehicle market and has attracted the attention of more and more automakers; second, the country's policy on tariff reduction for new energy vehicles is very beneficial to car companies. Moreover, the reserves of nickel laterite, which is the raw material for power batteries, can support the great development of lithium-ion batteries in the country. However, because lithium battery projects require complex nickel smelting technology, analysts are cautious about the pace of development of new energy vehicles in Indonesia.

Indonesia is already the second-largest car producer in Southeast Asia, and officials believe Indonesia can become a major manufacturer of lithium batteries in the region and supply enough lithium batteries for fast-growing demand for electric vehicles.

In June 2019, Toyota said it would accelerate the transformation of its products to electrification and announced a battery partnership with Ningde Times and BYD. It also released the results of its entire line of new energy vehicles, including plug-in hybrid models and pure electric models. However, Toyota officials have also said that at present, they still do not intend to give priority to the development and manufacture of pure electric models, and will continue to make breakthroughs in this field from plug-in hybrid models.

Toyota is rapidly approaching the point in time to meet its electric vehicle sales target, so it continues to take various measures to speed up its action. In 2017, Toyota revised its target to make electric vehicles account for half of its car sales by 2030, but now Toyota has advanced the target to 2025.

Toyota is actively preparing to launch the first model in its new electric car line, while an exclusive electric vehicle production facility with access to the natural resources needed for mass production may expand Toyota's manufacturing plans and deliver more vehicles to customers.

If the plan to invest in Indonesia succeeds, Toyota can determine its position in the fast-growing global electric car market.

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