The motorcycle sector was one of the most under-considered environmental elements of the 2024 budget tabled by Prime Minister Anwar Ibrahim last Friday.
The RM2,400 incentive towards the purchase of an electric motorcycle, for those earning no more than RM120,000 a year, seems like a very rushed job by a harassed officer in the finance ministry.
It’s not going to work if the objective is to replace combustion engine motorcycles in Malaysia as part of the decarbonisation process.
Malaysia is not the only motorcycle-dense country finding it hard to decarbonise in that area. So far, China is the only country in the world where electric motorcycles outsell the combustion variety.
A two-wheeler industry participant, who declined to be identified as he was not authorised to talk with the media, said they were pleasantly surprised by the budget’s incentives for motorcycles, inconsequential though they might be.
On the other hand, he said his colleagues in the car side had lobbied hard for incentives and were confident the ministry for investment, trade and industry had supported the proposal of incentives for electric vehicles costing below RM100,000.
That’s why BYD worked hard to launch the Dolphin at RM99,000.
Surprise for the industry
“There wasn’t any clear discussion with us about two-wheelers, just a general enquiry about what’s our wishlist for the budget. So I’m surprised there was an incentive for two-wheelers but not four-wheelers,” the industry insider said.
“Basically, electric motorcycle prices should be around the prices of underbone motorcycles (“kapcai”) before incentives are realistic,” he said.
There are less than a handful of road-legal electric motorcycles available for sale in Malaysia. Indicative prices start from RM14,000 while premium brands such as BMW’s Motorrad start from RM46,000.
Affordable EV motorcycles currently don’t have the performance that customers expect. For RM14,000, a combustion motorcycle would have a cruising speed of 110km/h and a range of 200km, equivalent to riding the whole day on a single tank of petrol.
In contrast, an electric motorcycle would do a top speed of 100 km/h for perhaps one hour before its battery is depleted.
Make it affordable
Che Wan Azuar, president of the Super Bikers Club of Malaysia, says most electric motorcycles should be around the “kapcai” price of about RM5,000 to be more realistic if someone wants to use the bike for work.
“When the electric motorcycle is priced beyond combustion engine prices, the masses will not buy it. It’s beyond a lot of people’s reach. If they go on hire purchase, then paying around RM200 a month is more doable.
“There must also be battery swapping where the rider can take out the battery and charge at home,” he said.
Finally, there is one Malaysian Tier 1 automotive vendor which could have found a way for the domestic motorcycle industry to transition to decarbonisation.
Batteries not included
Following the paths led by China, India and Vietnam, the concept is to sell an electric motorcycle separately from the battery, which makes sense because the battery costs about half the price of the motorcycle.
This company, EP Manufacturing Bhd, which makes stamped metal parts for major Malaysian car companies, partnered with a Chinese electric motorcycle maker last year and launched the EP Blueshark R1 and R2 electric motorcycles with prices starting from RM7,000 to RM9,000 without batteries.
The batteries are rented according to monthly plans at RM1.95 per battery swap, or up to RM139 a month for 120 swaps.
The company has a relationship with Grab to promote electric motorcycles to their delivery riders.
This is where the government can help boost the energy transition for motorcycles by rewarding companies that help Malaysia meet its international commitments to minimise the impacts of climate change.
What’s happening elsewhere
The energy transition in the motorcycle sector is progressing at different rates in China and India, where the motorcycle density is as high as it is in Southeast Asia.
China has been a frontrunner in the adoption of electric motorcycles. These policies have led to Chinese manufacturers dominating the global market.
In India, the transition towards cleaner energy in the motorcycle sector is gaining traction. Major Indian manufacturers such as Hero, Ola and Mahindra have responded to government support by focusing on developing electric motorcycles and investing in charging infrastructure.
Together with Vietnam, the path for electrification of motorcycles seems to be battery swapping or leasing, and the sale of electric motorcycles with a battery swapping plan.
We trust that the government will draft more pragmatic incentives to electrify the more than 400,000 new motorcycles that roll on to the roads annually in Malaysia.
Electrifying the motorcycle sector will reduce sound pollution and probably road deaths. - FMT
The writer can be contacted at yamin.vong@gmail.com
The views expressed are those of the writer and do not necessarily reflect those of MMKtT.
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