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SEOUL, March 17 (UPI) -- South Korean automaker Hyundai Motor opened its Indonesia factory, where the company plans to roll out electric vehicles, including the Ioniq 5. The plant, which is located in an industrial complex about 25 miles east of Jakarta, will manufacture EVs to meet the demand in Southeast Asian markets, according to Hyundai.
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The company has vowed to spend $1.55 billion to increase the factory's annual capacity to 150,000 units later this year and eventually to 250,000 units.
Wednesday's opening is part of the automaker's efforts to enter the emerging EV market. Earlier this month, Hyundai announced its goal of selling 1.87 million EVs in 2030 to secure a 7% global market share.
Toward that end, the Seoul-based company announced its plan of spending $78 billion to electrify its cars through 2030.
The corporation is also set to move into the Japanese EV market this year just 12 years after leaving due to disappointing sales.
Hyundai will sell only eco-friendly vehicles, including the Ioniq 5 midsize crossover electric car and the Nexo SUV fuel-cell vehicle, in Japan.
"Indonesia is a key hub for Hyundai Motor's future mobility strategy. This plant will play a key role in the automotive industry and specifically in the field of electric vehicles," Hyundai Chairman Chung Eui-sun said in a statement.
"Moreover, Hyundai will keep contributing to the establishment of the electric vehicle ecosystem in Indonesia through the battery cell plant currently under construction," he said.
Observers point out that competition will intensify in the EV market in Indonesia and neighboring countries.
"Japanese brands have dominated the Southeast Asian automotive markets, including Indonesia. But things are different for EVs," Daelim University automotive Professor Kim Pil-soo told UPI News Korea.
"Hyundai and other brands are expected to stage a stiff rivalry in the EV market. U.S. companies like Ford and General Motors are likely to venture into the region's EV market," he said.
