MALAYSIA is moving towards a greener and more sustainable future in line with global efforts to reduce carbon emissions and tackle climate change. In this journey, electric vehicles (EVs) play a crucial role.
The EV industry is not only rapidly growing worldwide but is also gaining significant traction in the ASEAN region, including Malaysia. The country has laid a solid foundation to develop its EV ecosystem with clear goals set to achieve net zero carbon emissions by 2050.
However, introducing an EV culture into the Malaysian economy is no easy task. Although there is tremendous potential, the main challenge is to drive mass adoption and encourage consumers to purchase electric vehicles.
This is where the government plays a crucial role by implementing policies that support the growth of the EV ecosystem.
In the 12th Malaysia Plan (12MP), the government has emphasised its commitment to green growth with EVs as a key strategy to achieve this.
Towards this end, the country has introduced policies like the National Automotive Policy (NAP) 2020 which promotes the adoption of Energy Efficient Vehicles (EEVs), including EVs, to reduce carbon emissions.
Additionally, the Low Carbon Mobility Blueprint (LCMB) 2021-2030 – introduced by the then Environment and Water Ministry – aims for EVs to make up at least 15% of total vehicle sales by 2030 and for 10,000 EV charging stations to be built by 2025.
EV industry challenges
Malaysia also has significant potential in the EV manufacturing ecosystem. Reputed to be one of Southeast Asia’s leading electrical and electronics (E&E) manufacturing hubs, the country has strength that can be leveraged to produce high-value components crucial to electric vehicles.
With a mature E&E ecosystem, Malaysia can support the manufacturing and assembly of EVs and autonomous vehicles (AVs).
However, achieving these goals comes with substantial challenges. EVs and their batteries are still relatively expensive due to limited local production of critical components.
The availability of charging infrastructure, vehicle services and supportive policies is also insufficient. Consumer concerns such as maintenance costs and perceived risks, further hinder the broader adoption of EVs.
To address these challenges, Putrajaya has established an Electric Vehicle Taskforce led by the Ministry of International Trade and Industry (MITI). This task force was formed to develop comprehensive EV policies and streamline incentives to encourage EV adoption in Malaysia.
As one of the key agencies, the Malaysian Investment Development Authority (MIDA) is committed to attracting high-quality investments in the EV supply chain.
The government has also introduced various incentives to stimulate the growth of the EV industry. Among these incentives are full exemptions from import duties, excise duties and sales tax for locally assembled EVs until Dec 31, 2025.
Additionally, EV users are eligible for road tax exemptions until the end of next year. These initiatives are expected to boost EV ownership and drive green investment in Malaysia.
Beyond this, attractive tax incentives are available for the development of critical EV components such as battery management systems and charging technologies. These incentives – including tax reliefs for EV charging infrastructure – demonstrate the government’s commitment to strengthening Malaysia’s EV ecosystem.
The fruits of these incentives are that two leading South Korean companies, namely Samsung SDI Energy Malaysia and SK Nexilis, have made substantial investments in EV battery cell and component production in Malaysia.
These investments reflect international confidence in Malaysia’s commitment to a greener future.
In this effort, Tenaga Nasional Bhd (TNB) has also played a key role by implementing a 10-Year EV Roadmap that targets 500,000 electric vehicles and 18,000 charging stations by 2030.
To achieve this vision, TNB is building EV charging infrastructure across the country while conducting research and development on smart charging and autonomous vehicle technologies.
With strong policies, investment support and public-private partnerships, Malaysia is on the right track to realise its green mobility aspirations by 2050.
These efforts not only aim to reduce carbon emissions but also to create high-skilled job opportunities, attract green investments and build a more sustainable future for the next generation. – Sept 9, 2024
Ashraff Hussni is an experienced strategic communicator in cutting-edge technology industry within the public sector for more than a decade.
The views expressed are solely of the author and do not necessarily reflect those of Focus Malaysia.
Main image credit: Tayaria
