The Malaysian automotive industry demonstrated “continuous holistic growth” in 2017, as we enter into the fifth year of the 2014 National Automotive Policy (NAP). This was said at the Updates on the Automotive Industry 2017 and Outlook in 2018 event held in Kuala Lumpur today, where minister of international trade and industry Datuk Seri Mustapa Mohamad briefed the media.
The main pillar of NAP 2014 was Energy Efficient Vehicles (EEVs), and the regulators are happy with the rate of EEV adoption in our market. EEV penetration increased for the fourth straight year, reaching 52% of vehicles sold in the country last year. That’s 2% higher than the target set.
The figure was 42.8% last year, so it’s a jump of nearly 10%. Of these fuel efficient vehicles, 83.2% were petrol powered, 13% were diesels and 3.8% were hybrids.
MITI says that 19 carmakers are offering EEVs in Malaysia and EEV production volume rose from 247,912 units in 2016 to 308,807 units last year, higher than the target of 260,000 units. Malaysia’s definition of EEV is much broader than Thailand’s eco car programme and Indonesia’s Low Cost Green Car programme though, and does not have size or price constraints – full explanation here.
“This continuous growth is a signal of growing awareness of EEVs within the Malaysian automotive sphere. The acceptance and awareness of energy efficiency is not a function of a single ministry, but signals the support and participation of all government institutions, automotive OEMs and vendors, as well as the public,” Mustapa said.
Exports of automotive parts and components are expected to increase in 2017, as the industry recorded total export value of RM9.3 billion as at October 2017. The 2016 total value was RM11.2 billion and the Malaysian Automotive Institute (MAI) expects 2017 figures to surpass the RM12 billion mark.
Exports of remanufactured (reconditioned) parts and components was valued at RM516.4 million as of November 2017. This is already higher than last year’s total value of RM510 million.
While automotive parts and components, both new and recond, are a bright spot, Mustapa said that he was “disappointed” with the performance of CBU car exports, which has hovered around the RM1 billion mark for a few years without much progress (RM944.2 million as at November 2017, from 18,887 units). The minister said that moving forward, more focus will be put on parts exports.
Mustapa elaborated that the size of the automotive industry in Malaysia – which contributes 4% of the country’s GDP and employs over 730,000 people – requires a holistic outlook, as high value employment and business opportunities create significant impacts for Malaysians, which are often overlooked in favour of singular indexes such as sales and production figures.
Speaking of employment, the auto industry hired 27,175 people in 2017, a 4.93% increase from 2016. Mustapa emphasised that 23,444 foreign workers were replaced by locals in an industry that employs 736,632 in total.
“The growth of the automotive industry has created new career opportunities for Malaysians. Certified human capital programmes have been developed by MAI since 2014, not only to allow faster penetration of skills into the industry, but at the same time address the pertinent issue of foreign worker replacement among industry players,” Mustapa said.
This is the fourth and final annual report card for NAP 2014. At the event, MITI also revealed its projections for 2018, and said that a review of the National Automotive Policy (NAP) roadmap is currently in progress and will be revealed by mid-2018.
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New NAP shud focus to increase taxation on cars by introducing a pollution tax (like sin tax for tobacco & liquor). Then shove all that money into more public transports.
Oso, gov must even the playing field between petrol & other motive vehicles, by revamping the road tax to follow vehicle weight regardless of the type of engine it uses. See how Norway does it for petrol & equivalent EV car. All same same tax cuz both will wear out roads at the same rate.
Yupz. All same same roadtax cuz my Rolls Royce WP roadtax $27K but nextdoor jiran same RR pay 5k Swk roadtax.
And yet protong is yet to produce their own EEV.
Its becoz their factories arent EEV compliant, therefore they not able to get EEV certify. Unlike P2 that leverage on their brand new factory. Deswai P1 needs Geely investment to upgrade its plant and then they can get EEV
Geely is coming.
Want a real deal for public? Let it be an open and free market, driven by customers’ need. No customized incentives, no preference. No point of having complicated policy but with poor implementation and manipulated by many.
No incentives who wants to CKD here? Ekceli if no incentives, no brands will want to CKD in ASEAN.
MITI & JPJ Must Go For CO2-based Car Tax System!
22 Jun 2017:
Thai government reduces excise taxes on EVs, hybrids
…The Thai government’s new preferential excise tax rates for hybrid and electric vehicles are set to drive greater demand for this type of vehicle, said vice-chairman of the Federation of Thai Industries (FTI), Suparat Sirisuwanangkura as reported by the Bangkok Post. Currently, sales of hybrid and fully electric vehicles were limited due to the unattainable retail prices, according to the report.
Under the current tax regime, passenger pick-up vehicles (PPVs) with CO2 emissions of less than 175 g/km are subject to 25% tax, while double-cab pick-up trucks with CO2 emissions of less than 175 g/km will taxed at 12%. The new tax structure will reduce these to 23% and 10% respectively.
For passenger cars with CO2 emissions below 100 g/km, excise tax under the current regime is 10%; below 150 g/km, tax is 20%; and below 200 g/km, 25%. The new structure will reduce these figures to 5%, 10% and 12.5% respectively. For full battery-electric vehicles (BEVs), the excise tax drops from 10% to two percent in the new structure.
Announced on the Royal Gazette on Tuesday, the new excise tax incentives are meant to promote local Thai production of EVs and hybrids, and the incentives expire late in 2025. The Thai Board of Investment also included 10 more key EV parts to the list which will be income tax-exempt for eight years.
In March this year, Thailand’s BoI approved a set of promotional privileges for EVs, particularly for the local production of hybrid electric vehicles (HEVs), plug-in hybrid electric vehicles (PHEVs) and battery electric vehicles (BEVs). The programme covers passenger cars, pick-up trucks and buses, with different rates of privileges based on the technology for their production.
These include batteries, traction motors, battery management services, AC/DC converters, inverters, portable electric vehicle chargers, electrical circuit breakers and EV smart charging systems. Manufacturers that invest in these items will gain additional privileges and a 50% reduction on corporate income tax for a further five years, if they establish their plants in the Eastern Economic Corridor and submit applications by Dec 29.
http://paultan.org/2017/06/22/thai-government-reduces-excise-taxes-on-evs-hybrids/
CO2 based taxation only benefits the rich that can afford cars with hi techs to reduce CO2. Thats not fair. A better tax weightage system is follow Norway, where regardless of engine type, vehicles of similar weight pay the same taxes via a weight tier rate.
and so MAI said the automotive industry growth is thanks to……MAI…..