South Korean automaker KG Mobility (KGM) Company has announced it has signed an agreement with Indonesian state-owned defense company PT Pindad to collaborate in the production of vehicles for the local market.
The two companies signed a Head of Agreement (HOA) last week focusing on two key areas: the local assembly of KGM’s Rexton SUV and the development and production of battery-powered buses for the local market. The signing ceremony was held at Pindad’s headquarters in Bandung, the provincial capital of West Java, and was attended by KGM chairman Kwak Jea-sun and CEO Hwang Ki-young, along with Pindad CEO Sigit P Santosa.
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KGM said in a statement that the two companies plan to “collaborate on the Indonesian government’s ‘National Car Project’ and the local production of electric buses, based on KGM’s electric vehicle lineup and KGM Commercial Vehicle’s (KGMC) electric bus platform.” KGM confirmed it will provide engineering and technical support for “product feasibility reviews and localized vehicle development.”
KGM stated that the two parties have agreed to “actively cooperate to gradually expand the joint development projects to a scale of 200,000 units, including additional new model supply and support for Pindad’s leadership in both the national car initiative and electric bus production in Indonesia.” According to KGM, Pindad currently supplies more than 70% of Indonesia’s military vehicles, including armored vehicles, and other equipment.
KGM pointed out that it exported 1,060 Rexton SUVs as knocked-down units to Indonesia last year, and that it plans to increase this to 3,000 units in 2025.
In addition to Indonesia, KGM said it signed a preliminary agreement in March 2025 with Peru’s with Fabrica de Armas y Municiones del Ejército (FAME) for the supply of official government vehicles and joint technology cooperation.
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By GlobalDataChairman Kwak Jea-sun said in a statement: “The Musso Sports and Rexton have already proven their quality and performance in global markets, having been adopted as official government vehicles in the UK, Bulgaria, and Peru. Indonesia, being the largest automotive market in Southeast Asia with immense growth potential, is a strategic and promising opportunity for us. KGM will dedicate its efforts to expanding sales through differentiated product competitiveness and market-specific strategies.”
