Proton unveiled the first model under its EV brand eMas — the Proton e.MAS 7 — on Aug 2. The C-segment SUV is expected to go on sale from December. — Photo: Proton
THERE is not a month that goes by without new electric vehicle (EV) models being launched in the domestic market, with import and excise duty exemptions until end-2025 driving sales.
Several joint ventures and initiatives are underway to build the infrastructure for smooth operation of EVs, supported by the National Energy Transition Roadmap.
As part of its fuel subsidy rationalisation initiatives, the government removed the blanket diesel fuel subsidy and replaced it with a targeted diesel fuel subsidy regime.
It, however, has not yet withdrawn the blanket RON95 petrol subsidy. This will certainly affect more vehicle owners while hopefully encouraging the market to reconsider EVs or alternative fuel vehicles.
Even so, Malaysia’s domestic car manufacturers, Proton and Perodua, will find it challenging due to the lack of supporting infrastructure, supply chain, technology and expertise, to build and produce EV models.
When they do launch their EV models, they would have to contend with Chinese EVs which have been in the domestic market longer and been aggressively marketed.
Can local vendors pivot to EVs from supplying internal combustion engine (ICE) automotive parts to Proton and Perodua?
According to P. Up Power-Up Malaysia chief marketing officer Nizam Arifin, the domestic automotive industry’s ability to pivot towards EVs is mixed.
Incidentally, Smart EVs and the Volvo XC40 are the only locally assembled EVs and both are connected to Geely, which owns Volvo and is in a joint venture with Mercedes-Benz for Smart. Geely also has a 49.9% stake in Proton.
“Local manufacturers face significant challenges in terms of technology transfer, production capabilities and market competition. The transition requires substantial investment in R&D, retooling of manufacturing processes and upskilling of the workforce,” Nizam points out.
At the Malaysia Autoshow 2024 in May, Perodua unveiled a prototype EV based on its popular Myvi. A new version of the prototype, developed in collaboration with an Australian EV specialist and local universities, will be unveiled later this year or early next year.
The Myvi EV model is expected to go into production next year, but no date has been given for its launch. The model will be priced between RM50,000 and RM100,000.
Proton unveiled the first model under its EV brand eMas — the Proton e.MAS 7 — on Aug 2. The C-segment SUV is expected to go on sale from December.
According to reports, other models in the pipeline include a sedan and a hatchback/SUV crossover.
Geely plans to turn Malaysia into a regional EV hub through a US$10bil (RM45bil) investment in Tanjung Malim, Perak as announced in July 2023. Additionally, it plans to train 5,000 people within five years to fulfil regional ambitions.
According to Ernst & Young PLT senior executive director Anand Bala, market success will depend on strategies that cater to Malaysia’s unique economic and social landscapes.
“Capitalising on Malaysia’s strategic location, supportive government policies and a tech-savvy consumer base will be crucial for establishing a strong foothold in the regional EV market,” he says.
He adds that there are a number of obstacles, including high cost of EVs, a nascent charging infrastructure, a developing supply chain and subsidised petrol prices.
Until Proton and Perodua begin manufacturing EVs locally, those seeking one will only have access to foreign brands, and they are all priced above RM100,000. That is the only condition imposed by the government on imported EVs.
The highest end of the market is occupied by Tesla and the luxury European marques. With what they offer in comparison to Tesla and the European models, Chinese EVs are fast gaining traction in the market.
Since no comparable models exist at their price points, the Chinese EVs are at an advantage because they are sleek and state-of-the-art.
Affordability aside, Gentari deputy CEO Shah Yang Razalli says market acceptance for EVs remains cautious despite the more than four times increase in EV registrations in 2023 compared with 2022.
“Moreover, range anxiety continues to be a concern, making EV adoption challenging for most people. Much still needs to be done to grow the EV infrastructure ecosystem.
“The coordination and steering stewarded by the National EV Steering Committee has enabled improvement in streamlining regulatory requirements amongst the agencies,” he adds.
He notes that Malaysia Automotive Robotics and IoT Institute’s introduction of the Electric Motorcycle Usage Incentive Scheme “is a commendable step towards broadening the appeal of EVs. By offering rebates to lower-income households, the scheme aims to make green mobility more accessible and inclusive”.
This article first appeared in Star Biz7 weekly edition.
