However, incentives don’t guarantee success. Malaysia abolished tax breaks on electric vehicles in 2014 after failing to persuade manufacturers to speculate. It abandoned a commitment to eliminate import tariffs on 100 Tesla cars, which was announced by Prime Minister Najib Razak during his visit to Tesla’s headquarters in California last 12 months.
Instead, the Malaysian government now prefers to approach manufacturers individually, and this strategy appears to be working for Chinese corporations. Beijing Auto International Cooperative, China’s second-largest electric vehicle manufacturer, unveiled its first model for the Malaysian market, the EV200, in November last 12 months. The automobile has a variety of 200 km and is anticipated to go on sale in 2018 on the earliest.
Malaysia must also profit from the acquisition of 49.9%. shares in domestic manufacturer Proton Holdings by Zhejiang Geely, the Chinese group that owns Volvo. The partnership potentially means access to a big selection of Geely products and technologies, including the Emgrand EV300, the best-selling electric automobile in China.
Partnership with Chinese corporations also means access to batteries. China currently controls about 75 percent of the worldwide marketplace for electrolyte solutions, a key ingredient in lithium-ion batteries, in line with Yano Research Institute, a Japanese market research firm.
These changes should help electric vehicles to achieve a foothold in Malaysia faster. However, this relies on the attractiveness of Chinese brands, in addition to Proton, to Malaysian consumers. Proton’s market share has declined significantly: it was just 14 percent last 12 months, down from 32 percent just over a decade ago and 64 percent at its peak in 1996.
Leaf factor
In terms of customer recognition, two global players within the BEV sector should profit from a major presence within the region: Chevrolet i Nissan. The latter, popular with a median of 8 percent of automobile buyers within the five Southeast Asian countries we surveyed this 12 months, has expressed interest in producing and selling electric vehicles in Southeast Asia if government incentives are introduced.
Last month, Nissan unveiled the second-generation all-electric Leaf in Japan, replacing the prevailing model that’s currently the world’s best-selling BEV outside China. The recent automobile has a variety of 241 km and can compete with other mass-market electric vehicles corresponding to Chevrolet’s Bolt EV and Tesla’s Model 3, and is prone to be the primary of those models to be produced and sold in Southeast Asia.
Nissan Alliance with Mitsubishi and Renault should profit from their EV enterprise through purchasing and logistics, in addition to combining technologies and platforms. Mitsubishi has a powerful presence in Southeast Asia, and our research showed that it’s certainly one of the highest 10 brands amongst consumers in Southeast Asian countries. The company recently opened a $565 million factory in Indonesia that may produce 160,000 units a 12 months, representing 27 percent of its regional production capability.
Above all, the race amongst Asian countries to draw investment in domestic electric vehicle production will rely on how quickly consumers adopt the brand new technology, which in turn will rely on how quickly governments deploy infrastructure corresponding to charging stations. Thailand and Malaysia take the lead.
This article was first published on October 5 by FT Confidential Research.
FT Confidential Research is the Financial Times’ independent research service, providing in-depth evaluation and statistical insight into China and Southeast Asia. The team of researchers covering these key markets combines insights from their very own research with field research to supply investors with predictive evaluation.
