Tesla is close to reaching a preliminary agreement to build a factory in Indonesia, according to people familiar with the matter.

(Reuters file photo)

[Financial Channel/Comprehensive Report] According to people familiar with the matter, Tesla is about to reach a preliminary agreement to set up a factory in Indonesia. The target of the new factory is to have an annual production capacity of 1 million vehicles. Facility planning, including production and supply chain.

"Bloomberg" reported that Indonesia has long been courting Tesla. In May last year, Indonesian President Joko Widodo met Tesla CEO Elon Musk and reached a $5 billion deal in August. nickel supply agreement.

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Jokowi said in an interview at the time that he hoped that Tesla could produce electric vehicles in Indonesia, not just batteries, and that he was willing to spend time persuading Musk not just to regard Indonesia as a supplier of key resources.

According to people familiar with the matter, the two parties have not yet formally signed, so the agreement may still fall through.

If the agreement is finalized, the Indonesian factory will become Tesla's third factory outside the United States after Shanghai and Berlin.

While Indonesia is the gateway to Southeast Asia's 675 million consumers, it's a tough market for global automakers, with cars priced below $20,000 accounting for the bulk of sales.

Musk said in August last year that the company expected to eventually build 10 to 12 more factories around the world.

According to "Bloomberg" a few days ago, Tesla also negotiated to set up a factory in Mexico at the end of last year, and plans to discuss the expansion plan of the Texas factory at the investor day on March 1.

Tesla’s stock price closed up 3.68% on Wednesday (11th), after the stock plummeted 65% last year.

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