MAAri has allowed Thailand and Indonesia to overtake us in the EV race

KUALA LUMPUR: In recent years we have seen the Malaysian automotive industry take a slow and steady decline despite an increasing population and a higher number of new vehicle models and variants being launched in the country.

Many will point the finger at our economy and some others will say it is the failings of our delayed national automotive policy (NAP). Well, in our humble opinion, it is a combination of both and the HUGE allowances given to one national car brand to continue rebadging cars and selling them at a price point that no Japanese or Korean car manufacturer can match.

Why can't it be matched? Well, preferential tax incentives and the large number of ‘import approve permits’ that was accorded to the national car brand, allowed them and their rebadging automotive partner in China to import in these vehicles without high import tax and AP costs, thus allowing them to enjoy high profits despite having a low selling price.

Well, we have high import taxes for automobiles, probably the third highest in ASEAN and so having the above mentioned incentives allows for ‘extra’ profits to be enjoyed. Malaysian car buyers have benefited, but short term as the rise in after sales issues and lack of spare parts for these rebadged SUV’s and Crossovers are starting to overheat on social media.

Meanwhile, long established automotive brands like Toyota, Honda, Nissan have set up large factories over the years to locally assembly vehicles to get lower taxes as the rebadged national car with a lower selling price takes huge sales and up to 6 to 7 months waiting list and the market share shifts away from the Japanese and Korean car manufacturers.

This is why in the past 2 to 3 years, these brands have decided to concentrate less in Malaysia and invest more in neighbouring Thailand and Indonesia. The timing is perfect for them as with proper ‘Electric Vehicle’ incentives from Thailand and Indonesia’s automotive agency, they can ‘plan ahead’ properly and slowly leave basic manufacturing in Malaysia.

Here is where MAAri has neglected the Malaysian car industry whilst Thailand’s automotive agency has pushed hard for global car manufacturers to set up factories for ICE and EV.

Honda Japan has two factories in Thailand. Motor Image from Singapore who handles the Subaru brand for the region set up a brand new factory 3 years ago just outside of Bangkok to assemble Subaru crossovers and SUV’s for the region. Hyundai is building a new factory in Indonesia and investing in EV battery manufacturing.

Meanwhile, our Malaysian automotive agency, MAAri is busy looking at Unified e-commerce, e-commerce marketplace (signed with PH Empire Holdings Berhad which is listed as a wellness provider, not automotive provider), Covid-19 test kits and also beauty products recently.

MAARi is supposed to be involved in all things automotive and not the health and beauty industry and this is why global auto manufacturers are losing their long term confidence in Malaysia and soon we will be a country with a high volume of re-badged vehicles tagged as national cars and many automotive jobs will be lost and engineering talents will migrate to Thailand and Indonesia to seek better opportunities.