An analyst said Malaysia is still trailing its regional counterparts when it comes to pursuing the EV agenda.
“Neighbouring countries such as Thailand, Indonesia and Singapore are making huge strides in defining their EV plans and are successfully attracting large-scale foreign direct investments.
“Malaysia, on the other hand, is still largely focused on incentives that promote internal combustion engine vehicles (ICEVs). We need to shift that focus if we want to attract more investors within the EV space, or we will risk losing out to our regional peers, ” he told StarBiz.
According to Maybank Investment Bank Research (Maybank IB), the publicly available draft copy of the “Low Carbon Mobility Blueprint 2021-30: Decarbonising Land Transportation” report on Malaysia’s upcoming EV roadmap has many positives.
“For a start, it is more EV-focused compared with the National Automotive Policy 2020. That said, it fails to drive home the aspiration to accelerate EV adoption from ICEVs to battery EVs (BEVs).
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“Based on our interpretation, the EV policy is skewed towards plug-in hybrid EVs (PHEVs) and not BEVs. Of the 100,000 units of EV to be fully tax exempted, only 10% (or 10,000 units) is allocated for BEVs, up to 2022.
“This means 90,000 units are for PHEVs, ” it said in a report.
Citing the International Council on Clean Transportation, Maybank IB said the fuel consumption and carbon dioxide emissions of PHEVs are up to four times the level of what they are approved for, as users do not charge them enough.
“A research by the European NGO Transport and Environment shows that when driven in combustion-engine mode, the carbon dioxide emissions are higher for PHEVs than they are for ICEVs.
“For that, the European Union wants to phase out PHEVs (as they are not considered a sustainable investment) by 2026, compared with 2030 previously, to accelerate its EV transition.”
An industry observer said EV is the future of the automotive industry.
“Each year, we’re seeing global vehicle manufacturers adding a new EV model to their line-up, ” he said.
Maybank IB noted that consumers tend to buy PHEVs solely for their lower price point, rather than for environmental reasons.
“PHEVs, when in pure electric mode, have lower driving range (100km or less) compared with BEVs (300km or more).
“This defeats the purpose of building a nationwide EV charging infrastructure, which is more BEV-purposeful than a PHEV. To emphasise this point, BEVs have consistently outsold PHEVs and hybrid EVs over the past four years by two-to-one.”
Additionally, the research house said PHEV sales in Asia-Pacific peaked in 2018 and have since been declining.
“That said, the policy needs to re-focus on BEVs and less on PHEVs. Until then, Malaysia is unlikely to inspire automotive original equipment manufacturers (OEMs) to bring in their BEV models and/or relocate their BEV plants here.”
MIDF Research in a report, meanwhile, believes that Malaysia’s low carbon mobility blueprint can drive larger participation in the EV space by foreign OEMs.
“Though it is still subject to cabinet approval and there is no certainty that all proposals will be implemented, the blueprint, which focuses on decarbonising the road transport sector, is a broad positive and could drive larger participation in the EV space by foreign OEMs, local distributors and local manufacturers, in which Malaysia has been falling behind regional peers.”
MIDF Research noted that the blueprint essentially entailed four focus areas, 10 strategies and 45 action plans, surrounding vehicle fuel economy and emission improvement; EV and low emission vehicle adoption; alternative fuel adoption; and greenhouse gas emission and energy reduction via mode shifts.
“The blueprint also outlines the adoption of BEVs in the government’s and government-linked companies’ (GLCs) fleet as a catalyst for wider adoption.
“This involves a target of 10% penetration of BEV in the government fleet by 2022, rising to 20% within 2023 to 2025.
“By 2026 to 2030, it is targeted that 50% of the government’s fleet will comprise of BEVs, ” it said.
For GLCs, MIDF Research said the target is to achieve 20% BEV penetration between 2023 and 2025, rising to 50% between 2026 and 2030.
