Malaysia stands united in the global mission to combat climate change. The nation has made a solemn pledge to significantly reduce our greenhouse gas emissions, with a vision to achieve Net Zero by 2050. Notably, the transport sector is currently the second-largest contributor to emissions in the energy segment and plays a pivotal role in determining the air quality in our urban centres.
“With this in mind, we are committed to the global effort to tackle climate change and have set ambitious targets for ourselves. With the launch of the New Industrial Master Plan 2030, our mission is clear: Push for Net Zero. Under one of the Action Plans, the Government has identified the EV ecosystem as a key growth driver. This ecosystem is vast and includes steel/aluminium, plastic composites, semiconductor and electronic chips, battery technology, textile industry, tyres for EV technology, charging infrastructure, after-sales services, maintenance and repairs, and end-of-life and second-life applications.
“By 2030, we aim for EVs to constitute 15% of the Total Industry Volume (TIV), and we envision this number to rise to 38% by 2040, and 80% by 2050,” said Minister of Investment, Trade And Industry (MITI) Tengku Zafrul Tengku Abdul Aziz at the launch of the first Tesla Centre in Cyberjaya today (Oct 2).
Turning the nation’s focus to the ASEAN region, there are immense opportunities on the horizon. The ASEAN electric vehicle market is forecasted to grow to a staggering USD2.7 billion (RM11.77 billion) by 2027, up from roughly USD500 million in 2021. This represents an annual growth rate of almost 33% from 2022 to 2027. In 2022 alone, global EV sales soared past the 10 million mark, capturing an impressive 14% of the entire new vehicle market. In the same year, the global expenditure on EVs exceeded USD425 billion, a 50% increase from 2021. This surge in demand has led to a 65% increase in the demand for automotive lithium-ion batteries, indicating that the global EV supply chain is expanding at an unprecedented rate.
Recognizing the importance of EVs in this journey towards a sustainable future, the Government has been proactive in fostering an environment conducive to EV production and adoption in Malaysia and the commitment to EV is evident in the strategic steps we’ve taken at the national level. Spearheaded by MITI, the National EV Task Force (NEVTF) plays a crucial role in shaping policies, overseeing program implementations, and championing EV-related initiatives. This task force is a testament to the collaborative spirit, bringing together various ministries, government bodies, and key industry players, Tengku Zafrul added.
The NEVTF ensures that all governmental bodies work in harmony, adopting a unified strategy for initiatives that might otherwise be fragmented. This represents a truly integrated “whole of Government” approach. “Recognising the need for even greater coordination, we’ve elevated the NEVTF to the National EV Steering Committee (NEVSC). This cabinet-level committee focuses on addressing complex issues that span multiple ministries, ensuring cohesive decision-making. Partnerships between the public and private sectors, exemplified by the NEVTF and NEVSC, are essential. They not only drive the growth of Malaysia’s EV industry but also support our economic aspirations and our goal of achieving net-zero emissions,” he said.
In terms of implementation, the NEVTF, under the NEVSC’s guidance, has undertaken several significant measures:
a. Firstly, we have introduced tax incentives to encourage EV production and critical EV component activities, as well as to boost EV usage in the country. These incentives encompass both direct and indirect tax exemptions.
b. Secondly, MITI has streamlined the Import License requirements for EVs to invigorate the EV market in the country.
c. Thirdly, we are working on developing industry standards related to the EV industry, such as charging systems, battery disposal activities, and battery swapping.
d. Fourth, the Department of Skills Development (JPK) under the Ministry of Human Resources (KSM) has developed the National Occupational Skills Standard related to Battery Electric Vehicles (NOSS BEV) for the country’s Technical and Vocational Education and Training (TVET) sector.
e. Fifth, the Energy Commission has prepared a guide, the “Guide on Electric Vehicle Charging System (EVCS)” to provide a conducive business environment for the development of EV charging stations.
f. Sixth, the Ministry of Local Government Development (KPKT) through PLANMalaysia has developed a procedure on EV charging station development to be used nationwide by all local governments in Peninsular Malaysia, and
g. Finally, the Ministry of Finance (MOF) is considering the implementation of EV procurement as departmental vehicles and official position vehicles.
All these reflect the Government’s commitment to develop a holistic ecosystem for EV in this country. So far, the implementation of NEVTF policies and initiatives has had a positive impact on our local automotive industry. The number of registered EVs increased to over 3,400 units in 2022 and exceeded 7,500 units by September 2023, compared to an average of 300 units in previous years. Furthermore, investments in our EV industry have reached an impressive RM26.2 billion from 2018 up to March this year.
Malaysia has also started developing the Automotive High Tech Valley (AHTV) in Tanjung Malim, Perak, as Malaysia’s next-generation vehicle hub, covering the extensive automotive and mobility solutions value chain. This is expected to attract a collective investment of RM32 billion from various parties. AHTV is the only automotive cluster in Malaysia to be officially recognised as an NxGV and Energy Efficient Vehicles (EEV) hub.
Our EV policy must also be examined in tandem with the recently launched New Energy Transition Roadmap 2030 (NETR2030). This is important because there is no point having thousands of EV’s on the road if we are not ‘greening our grid’ fast enough by developing more and more Renewable Energy (RE) sources. The NETR provides for, among others, accelerating investments in grid infrastructure and providing incentives for RE development.
As we look to the future and the upcoming Budget 2024, our focus remains on inclusivity, aligning with the MADANI Economy Framework. We aim to make EV ownership accessible to all, especially the B40 and M40 demographics, through targeted subsidies and financial assistance. Concurrently, we’re ramping up efforts to expand and enhance our EV charging infrastructure, ensuring a seamless transition for all Malaysians.
Tesla’s establishment in Malaysia goes beyond high-quality electric vehicles, job opportunities and a catalyst for innovation. It is about creating a ripple effect that will spur the entire EV ecosystem nationwide and build Malaysia’s potential as a regional EV production hub, which could attract further investments in this sector.
“I firmly believe that with Tesla’s presence, Malaysia is ready to expedite the transition to EVs, aligning with our broader environmental goals. So far, I am proud to mention that:
a. Tesla have committed to establishing a Service Centre by the end of 2023.
b. In terms of infrastructure, Tesla has already opened one Supercharger station with 8 stalls and plans to open another 12 stations, totalling more than 50 Supercharger stalls, by mid-2024.
c. On the employment front, Tesla has already recruited over 30 local staff and continues to hire as the business expands, with a commitment that at least 80% of full-time employees will be Malaysians.
d. Tesla is not just working in isolation. They have engaged local companies for various services, from transport and logistics to financial services and event management.
e. And in the spirit of collaboration and knowledge-sharing, Tesla has plans to partner with technical institutions and the youth in 2024 to develop know-how and skills. We encourage collaborations with local enterprises and partnerships with our technical institutions and youth, fostering a culture of knowledge-sharing and skill development.
“With Tesla’s presence, we anticipate a surge in technological advancements, research, and development in the EV sector. We look forward to seeing more local talents being nurtured, more local businesses thriving in the EV supply chain, and more innovations that will put Malaysia on the global map of sustainable transportation,” the minister added.
The journey began on the 1st of March 2023, when MITI granted Tesla the approval to import their pioneering electric vehicles into Malaysia under the BEV Global Leaders scheme. This was not just an announcement; it was a testament to the Government’s unwavering commitment to championing sustainable and innovative solutions for the nation’s future.
Since then, Tesla has made significant inroads in Malaysia, from the recruitment day in Cyberjaya that attracted over 6,000 job seekers, to the first opening of their Supercharges in Pavilion KL, the launch of their Model Y and Model 3, and today, the establishment of the Tesla Centre in Cyberjaya.
