JAKARTA (Reuters) - Indonesia's industry ministry said on Wednesday Japanese carmaker Mitsubishi Motors (OTC:MMTOF) was planning to invest 5.7 trillion rupiah ($375.25 million) in 2024 to expand its production capacity in the country.
The company planned to increase its production capacity to up to 250,000 units per year in 2024 and to start production of the Minicab-MiEV battery electric vehicle in its plant in Indonesia by the end of this year, according to a statement from the ministry.
Indonesia has been offering incentives to attract investment into production of EVs. The government is considering to remove import duty and value added tax on completely built up (CBU) EVs for companies investing in domestic EV plants, industry minister Agus Gumiwang Kartasasmita said.
"We are optimistic that, if implemented, this can boost investment and increase demand to use EVs," Agus said.
A Mitsubishi spokesperson said executives from its Tokyo headquarters on Wednesday met with Agus for talks, declining to comment further.
Elsewhere, the automaker plans to start production of hybrid vehicles in Thailand early next year, a move that would mark the first time for the company to produce hybrids overseas, Japan's Nikkei newspaper reported on Wednesday.
Mitsubishi declined to comment on the report.
After suffering a sales crisis in China, Japanese automakers are facing growing competition in Thailand from Chinese rivals in particular due to what has been a go-slow approach to EVs.
Mitsubishi has already taken a big hit in China, where its joint venture with Guangzhou Automobile Group (GAC) has cut staff after production of Mitsubishi's new Outlander sports utility vehicle was halted months after its launch in December.
Mitsubishi reported combined retail and wholesale sales in the ASEAN region of 120,000 vehicles for the three months to June 30, dropping 1.6% from a year earlier.
In Thailand, its retail and wholesale sales slumped to 17,000 units during that period, down from 25,000 a year earlier.
($1 = 15,190.0000 rupiah)