Abstract
In the process of the electrification of the vehicle industry, an important issue is to adapt production to new technological solutions and to achieve a break-even point in the production costs of an electric vehicle in the short term compared to its traditional counterparts. By the end of 2020, 10 million electric cars were sold worldwide. In today’s globalized and crisis market realities, it is very difficult for state authorities to build a competitive advantage. Based on the concept of M.E. Porter, generating competitiveness does not take place at the macroeconomic, but at the mezzoeconomic level. The key purposes of this review paper are threefold: firstly, to identify the infrastructure for the production of electric cars (market size, resources) in some major Asian countries, including Indonesia; secondly, to identify the importance of FDI for Indonesia and the essence of their relations with China, and thirdly, to investigate whether Indonesia is able to build a competitive advantage in the form of a regional EV battery chain hub. The Indonesian government should ensure a more sizeable investment in lithium-ion battery production in order to complete a whole downstream supply chain, which includes the synthesis of the remaining high-quality battery materials.
Highlights
In recent years, transport electrification has become a key element of the industrial strategy for almost all governments worldwide
The key purposes of the review paper are threefold: firstly, to identify the infrastructure for the production of electric cars in ASEAN countries, including Indonesia; secondly, to identify the importance of foreign direct investment (FDI) for Indonesia and the essence of relations with China, and thirdly, to investigate whether Indonesia is able to build its competitive advantage as a regional Electric vehicles (EVs) battery chain hub
The results suggest that the transfer of technology within FDI is more productive than domestic investment, especially when the host country has adequate human capital [33]
Summary
Transport electrification has become a key element of the industrial strategy for almost all governments worldwide. The key purposes of the review paper are threefold: firstly, to identify the infrastructure for the production of electric cars (market size, resources) in ASEAN countries, including Indonesia; secondly, to identify the importance of FDI for Indonesia and the essence of relations with China, and thirdly, to investigate whether Indonesia is able to build its competitive advantage as a regional EV battery chain hub. The definition of these key purposes led to the formulation of three research questions, which were developed following a study of the literature. The paper ends with conclusions, limitations and suggestions for further research
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