Jakarta -
Two automotive component factories in East Java are reportedly planning massive layoffs. This was revealed by the President's Special Adviser for Labor and Worker Welfare Said Iqbal.
The factory owners, whose parent company is from Japan, intend to change the company's direction to produce electric vehicles. According to Said Iqbal, the parent company wants to move its production to Vietnam and leave Indonesia. If this happens, thousands of workers will be affected by layoffs.
"In the Pasuruan and Mojokerto areas, East Java, there are two companies, I'm not yet able to mention their names. Two giant automotive component companies. There could be thousands of employees affected by layoffs," said Said Iqbal in a virtual press conference, Sunday (21/6/2026).
"So the principal in Japan will move its production to more productive countries and change its product diversification. So they will focus on electric vehicles with development carried out in Vietnam, not in Indonesia," he continued explaining.
He was reluctant to mention the two companies in question, but provided the initial letters of the company names, namely PT J and PT S.
From the information he gathered from labor union circles, the parent companies of the two companies located in Japan consider electric vehicle development more productive in Vietnam. Therefore, the companies will leave Indonesia.
"Because in Indonesia it appears that electric vehicles and electric vehicle factories are not competitive. But in Vietnam there is a policy for developing electric vehicle factories. Well, these two automotive component companies in Pasuruan and Mojokerto will move some operations. This is just an initial discussion. Preliminary information. This could also affect thousands who could be laid off," explained Said Iqbal.
Said Iqbal, who is also President of the Indonesian Confederation of Workers' Unions (KSPI), admitted that he had asked FSPMI, a labor union under his umbrella, to discuss with the company to protect workers' rights.
His side will also coordinate with the central government by providing a direct report to President Prabowo Subianto on this matter. According to him, the problem occurring in this case is at the level of electric vehicle policy from the central government.
(acd/acd)
