Apple is reportedly set to open an AirTag manufacturing facility in Batam, Indonesia, early next year, which will supply 65% of the global demand for the tracking device. Investment Minister Rosan Roeslani revealed that Apple has also acquired land for this factory.
The AirTag, a small coin-shaped device, is designed to help users easily track personal items. This move is seen as a strategic effort by Apple to encourage the Indonesian government to lift the ban on the sale of the iPhone 16 in the domestic market.
Indonesia Secures Apple’s Billion-Dollar Deal
Indonesia has banned the sale of iPhone 16 due to the company’s failure to comply with local content regulations, which require at least 40% of components or production processes to originate from Indonesia.
In response, Apple initially proposed an investment of $10 million, which later increased to $100 million, and eventually reached $1 billion—a move welcomed by President Prabowo Subianto.
Investment Minister Rosan Roeslani expressed hope that the factory would attract more Apple suppliers to invest in Indonesia, following the examples of other countries such as Vietnam, Malaysia, and Thailand. The government also envisions the factory as a gateway for Apple’s long-term investment in the country.
In addition to supplying 65% of global AirTag demand, the facility is projected to create up to 2,000 jobs, with expectations that Apple’s investment will grow from $1 billion to $3 billion, $4 billion, $5 billion, and eventually reach a target of $10 billion.
Questioning Apple's AirTag Investment, Ministry of Industry
Although the government is encouraging Apple’s investment to lift the ban on the sale of the latest iPhone in Indonesia, the AirTag factory project in Batam has yet to convince the Ministry of Industry.
Industry Minister Agus Gumiwang Kartasasmita stated that the AirTag factory investment does not meet the Local Content Requirements (LCRs) applicable to the iPhone 16. As a follow-up, the Ministry of Industry has submitted a counterproposal in the ongoing negotiations with Apple, although a meeting with Apple representatives on January 7 did not result in an agreement.
While the AirTag facility in Batam is scheduled to begin operations in 2026, Agus emphasized that the AirTag is not considered an accessory, nor is it part of mobile phones, computers, or tablets (HKT). Therefore, it is not subject to Local Content Requirements (LCRs) under Permenperin No. 29/2017 and Permenkominfo No. 27/2015.
