Want cheap EVs? Don’t hold your breath

 

Car fanatics like to talk about how electric vehicles (EV) will one day be cheaper than “normal” cars running on internal combustion engines. But it’s been just talk – until now.

At the ongoing Shanghai International Auto Show, China’s largest carmaker, BYD, launched its sub-US$11,000 Seagull with a battery range of more than 300km and an entry level price of about 76,000 yuan (RM49,000).

But if you’re holding your breath for a chance to buy sub RM50,000 EVs in Malaysia, you’d better think again.

It’s understood that there are hold-outs in the government, including the investment, trade and industry ministry(Miti), which are clinging to the policy of protecting national cars by keeping new energy vehicle (NEV) prices high, generally above RM100,000.

However, the solution is already in place. Remember Miti’s approval for Tesla to open shop in Malaysia? It must now extend the incentives awarded to Tesla to other NEV investors if they, too, commit to the installation of charging stations and whatever else that was required of Tesla.

We don’t only want to bring in Tesla, the world’s leading EV maker. We also want to bring in BYD, GWM, SAIC and the other NEV investors reshaping the automotive industry.

Prime Minister Anwar Ibrahim and investment, trade and industry minister Tengku Zafrul Aziz should make it a goal for Malaysia to attract at least five of the 100 NEV companies that are among the 1,000 exhibitors in Auto Shanghai.

Industrial policy shouldn’t involve the government favouring one company. That would only prove that Malaysia has not learnt its lesson from the introduction of the first national car where, over the years, carmakers who were initially interested in Malaysia instead selected Thailand which offered a more level playing field.

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Cruel as it may sound, there is more than a gramme of truth when critics say Malaysia’s highly protectionist national car policy was an own goal that benefitted Thailand’s motor industry.

If the government still wants to continue this protection, it should remember that Malaysian car buyers have suffered two decades of automotive nationalism by stomaching the high car prices that were the result of such policies. They can’t be expected to keep paying inflated prices.

If there is anxiety about the sustainability of Malaysia’s legacy car companies, be assured that they have earned plenty of money over the years and are no longer industry infants that need protecting. It’s not the government’s duty to protect the profits of legacy companies.

Besides, newcomers will still face an uphill task against these companies which already know the market, have a solid distribution network and boast strong brand recognition.

If these NEV firms can bring benefits like lowering transport costs and decarbonising land transport, so much the better.

There will also be a lot of new employment opportunities upon these producers’ entrance into the market, for roles in software programming and engineering and other areas, driven by new energy technology.

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Senior officials from some of the more ambitious Malaysian car companies are already at Auto Shanghai to woo the NEV makers there. Now, the government must join them and do its part in bringing them to our shores.

Ironically, maybe then we can finally achieve the vision of former prime minister Dr Mahathir Mohamad for Malaysia to be a regional automotive hub.

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