Change gear and go electric in our car industry

Dr Mahathir Mohamad should guide Malaysia into the age of New Energy Vehicles and autonomous vehicles rather than one more national car project

COMMENT

Regarded as the ‘father of Proton’, Dr Mahathir could drive Malaysia into a new automotive era. (Bernama pic)

By Yamin Vong

Many Malaysians don’t want another national car. We already have three, counting Naza. And we mostly appreciate them, especially MyVis.

Perhaps Dr Mahathir Mohamad could guide Malaysia into the age of New Energy Vehicles and autonomous vehicles rather than one more national car project.

China is the world’s biggest market for electric vehicle with 770,000 units sold last year, a 53% increase over the previous year. China is also the world’s biggest car market with 24 million passenger car sales last year.

We should learn from our history that we don’t have the volume compared to Japan (population 127 million, 2016) or South Korea (52 million). They could protect their markets while they developed their home-grown cars. When we began, Malaysia had a population of 17 million in 1980.

On his recent visit to Indonesia, where Mahathir had a chat with president Jokowi, he brought up his idea of an Indonesia-Malaysia car programme.

If Malaysia and Indonesia could begin regional cooperation, the combined market of a 300 million population in a dynamic economic region would attract investors.

All major car companies are already developing electric vehicles. A common set of fiscal incentives can draw companies that can make a RM100,000 EV with 150km range: they might choose to invest in Indonesia, or Malaysia, or Thailand, which is already the automotive hub of Asean. A win-win situation.

Patriotism and the motor industry

Patriotism about our automotive industry must be broadly defined and it would be better if it is more inclusive.

China realised that chauvinism was misplaced and changed its investment rules to include foreign car companies from this year. This spurred Tesla, the world’s leading EV car maker, to set up shop including a battery plant in China,

Even BMW is working with a China car company: Great Wall Motor, with a US$780 million joint venture to produce electric vehicles for domestic sales and export.

Now is the time for Malaysia to change gear in its National Automotive Policy, which is due for revision this year. I hope the government will position Malaysia as the region’s centre for New Energy Vehicles.

We’re already the second largest market in the world for BMW’s X5 PHEV (plug-in hybrid electric vehicle).

We should continue with long-term incentives so that car makers can recoup their investments. Remove customised incentives and make incentives available to all, fair and square. Thailand, for example, lists its incentives for the automotive and transport industry in its Board of Investments website.

How do we move to another level?

The future is Electric Vehicles and Malaysia has one of the most generous electricity reserves at 30% or 141.9 billion kWh according to the energy ministry.

The plug-in hybrid electric vehicle is the bridge for the next five years and Malaysia should extend these incentives. China provides subsidies for EV car buyers. Is that something to consider?

Nurture the New Energy Vehicle industry with long term incentives for 10 years, or three product cycles. Don’t champion any individual company. Make them compete for the market.

Remove the current AP policy so that revenue goes to the government, rather than individuals.

Provide legislative and geographical sandboxes for the new generation of autonomous vehicles so that we can position Malaysia, rather than Thailand or Singapore, as a real testing ground for car makers.

Yamin Vong is a motoring journalist and a respected voice in the automotive industry. -FMT