Time for hybrids as Malaysia car market booms

 

Malaysia’s car market is on a roll and while there are concerns that domestic demand was maxed out at the 830,000 new cars sold last year, a mid-term review of the National Automotive Policy (NAP) might push up the total industry volume to another high over the next two years.

A mid-term review of the NAP as mentioned by investment, trade and industry minister Tengku Zafrul Aziz in May, is timely because the global car industry is going into uncharted territory and hybrid electric vehicles are the new flavour of the year.

And as to whether hybrid electric vehicles will prolong the transition to the net-zero carbon economy, this process should be viewed from the perspective that the 2015 Paris Accord to keep global temperatures below a 1.5 C increase seems to have failed according to some climate science reports published in 

Nature

.

The CEO of a KLSE-listed automotive group said: 

Pacing the transition is key to ensuring that the international combustion engine players can cross over into electrification with just light bruises. The same holds true for the supply chain companies.

The source, who didn’t want to be identified, was speaking from the point of view of a legacy car maker that a headlong jump into electric vehicles (EVs) would crash the supply chain for combustion engines.

Coincidentally, Hyundai Motor group, the world’s number three automaker by sales, this week said that it would double its hybrid line-up from seven models to 14 by 2028.

Recently, the speed of conversion to electric vehicles has been slowing. As a result, demand for hybrids is increasing, and hybrids are becoming a basic option rather than an alternative to internal combustion engines,

 said Hyundai president and CEO Jaehoon Chang, according to a Reuters report.

Malaysia’s attractiveness as a car market seems to be going all right judging from the record number of cars and EVs sold, notching a robust 15% growth to a record 830,000 units in 2023.

Another signal of the automotive market’s vitality was the 230,000 paid ticket holders who visited the Malaysia Autoshow organised by the Malaysia Automotive Internet of Things Institute early this year.

In this context, Malaysians may soon be provided with a new choice of price competitive hybrids if the government adjusts its NAP to include petrol and diesel electric hybrids.

There’s also the dimension of the national cars where Proton and Perodua dominate half the domestic car market. Both their electric car models that will be launched over the next two years will set the tone for Malaysia’s electrification of the car transport sector.

Tengku Zafrul has successfully promoted Malaysia’s relevance in the regional car industry by opening the EV market to Tesla despite the protests of isolationists. Investments from many of China’s top car makers into Malaysia and their launching of a fresh range of car models with premium features at affordable prices has also whetted car buyers’ appetite .

The current NAP denies tax privileges to hybrid petrol-electric cars. This exclusion of hybrids should logically be one of the prime matters to be reviewed in the NAP.

The car market would certainly jump again and present a growing-sum game if hybrids are cheaper.

But should the government give a tax incentive for some of the hybrids which are so mild that they don’t even have an electric motor driveline?

There are many types of hybrids. Bear in mind that almost all of them are more fuel efficient than traditional combustion engine cars. Then again, some hybrids are more efficient than others.

Mild Hybrid Electric Vehicles
These vehicles use a small electric motor alongside a conventional internal combustion engine. The electric motor assists the engine but cannot power the vehicle independently. It typically helps with start-stop functionality and provides added torque.

Full Hybrid Electric Vehicles
Full hybrids can operate on just the electric motor, the internal combustion engine, or a combination of both. They can switch between modes based on driving conditions, offering improved fuel efficiency and reduced emissions.

Plug-In Hybrid Electric Vehicles
These have larger batteries compared to full hybrids and can be charged from an external power source. They can be driven for longer distances on electric power alone before switching to the gasoline engine. This type is suitable for drivers who can charge their vehicles regularly.

Series Hybrid or Extended Range Electric Vehicle
In a series hybrid, the internal combustion engine is not directly connected to the wheels. Instead, it acts as a generator to produce electricity for the electric motor, which drives the wheels. This configuration allows for greater efficiency, as the engine can operate at its optimal range.

Parallel Hybrid
Both the electric motor and the combustion engine can drive the wheels directly. The vehicle can use either source of power or both simultaneously, depending on the power demand and efficiency needs.

Series-Parallel Hybrid
This configuration combines both series and parallel hybrid systems, allowing versatility in how the vehicle operates. It can utilise the electric motor or the petrol engine independently or together.

These different types of hybrid vehicles offer varying levels of fuel efficiency, electric range, and driving experience, catering to diverse consumer needs and preferences in the car market.

If a PHEV is driven without its batteries being charged by external electricity, then its emission-free properties are not being enjoyed at all. A tax privilege for this type of vehicle owner-operator is an abuse of privilege, as it would be for the new Lamborghini Temerario with its three electric motors to boost a twin-turbo V8 4,000cc combustion engine.

Ultimately, the best way for the sustainable growth of Malaysia’s auto industry is to withdraw the petrol subsidy on a graduated scale so that electrification grows as a natural consequence of the electric motor being more efficient than combustion engines.

Together with smaller and more affordable EV, the charging infrastructure must grow until the density of chargers matches the population of EVs. - FMT

Yamin Vong can be reached at his Facebook page, yamin.com.my.

The views expressed are those of the writer and do not necessarily reflect those of MMKtT.