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Another national car? what about new energy vehicles

POSTED BY Yamin Vong ON 17 July 2018

Dear Tun Dr Mahathir Mohamad,

Please don’t take it personally that many Malaysians don’t want another national car. We already have three, counting Naza. And we mostly appreciate them, especially Myvis.

But considering your patriotism in the automotive industry, perhaps you could guide Malaysia into the age of New Energy Vehicles and autonomous vehicles rather than one more national car project.

You will be going to China next month and trust that this will inspire you because China is the world’s biggest Electric Vehicle (EV) market with 770,000 units sold last year, a 53 per cent increase over the previous year.

Of course, we’re hardly China in terms of scale. Yet we should learn from our history in national cars that we don’t have the volume compared to Japan (population127 million, 2016), South Korea (52 million, 2016, 38 million, 1980). Malaysia had a population of 17 million in 1980. They could protect their markets while they developed their home-grown cars.

China is also the world’s biggest car market with 24 million passenger car sales last year.

I think patriotism in the automotive industry must be broadly defined and that it would be better for a nation if it is more inclusive.

China realized that chauvinism was misplaced in the automotive industry and it changed its investment rules for foreign car companies to embrace inclusivity starting 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. BMW this week signed a USD780 million 50:50 joint venture to produce electric vehicles in Jiangsu Province for domestic and export.

And anyway, look at Didi Chuxing, China’s biggest ride-hailing transport enabler. It’s working with Continental AG to build a robo-taxi.

This venture follows an alliance between Didi with about 30 other companies including China’s GAC Motor and BAIC Group, as well as Toyota Motor Corp in April.

Zhejiang Geely’s investment in Malaysia, in Proton, is also a good development for us. Besides it being a profitable and successful company in its home country, it is also the owner of Volvo brand and Volvo’s proprietary technology and design.

We’ll soon enough experience it in the upcoming below RM100,000 SUV, the Proton Boyue (or Bayu or whatever name is chosen).

Dear Tun M. now is the time for Malaysia to change gear on its National Automotive Policy (NAP) and we’re speaking literally because the NAP is due for revision in 2018.

Your esteemed previous parliamentary colleague, Tok Pa, had already scheduled his Ministry of international Trade and Industry (MITI) policy think tank, the Malaysia Automotive Industry (MAI) to launch a refresh of the 2014 NAP this year.

But there’s a new government in town and you’re not only the leader of the nation, you’re also the father of the national car. With all that government and moral authority, YB MITI Darell Leiking and Deputy Minister YB Ong Kian Ming, are probably trying to interpret and anticipate how you want the NAP and Malaysia to head.

For me, I would hope that the government takes a direction that positions Malaysia as the region’s centre of New Energy Vehicles.

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

We need to continue with long-term (10 years) incentives for new energy vehicles so that car makers can recoup their investments.

Remove the customized incentives and replace it with a website detailing the 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. Perhaps we can be more competitive and adapt on that.

It’s an extension of your vision on using the car industry to increase the productivity of Malaysia’s workers, to move from tappers of rubber to makers of cars.

Now how to go from here to another level?

  1. The future is Electric Vehicles and Malaysia has one of the most generous electricity reserves at 30 per cent of 141.9 billion kWh (Energy, Green Technology, Science and Climate Change Minister, YB Yeo Bee Yin, 13 July 2018). The plug-in hybrid electric vehicle is the bridge for the next five years and Malaysia should extend these incentives. Is China’s subsidy programme for EV car buyers something to consider?
  2. Nurture the New Energy Vehicle (NEV) industry with long term (10 years or three product cycles) incentives; don’t champion any individual company. Make them compete for the market.
  3. Remove the current AP policy governing the current automotive market so that the government earns the tax revenue rather than individuals.
  4. 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.