KUALA LUMPUR: Malaysia presents many exciting business opportunies for investors and entrepreneurs in the rapidly growing electric vehicle (EV) market, due to government incentives as well supportive demographic and socio-economic factors, says Hong Kong E-Vehicles Business General Association (HKEV) president Kent Tang.
Tang was at a recent networking dinner organised by the Federation of Motor and Credit Companies Associations of Malaysia (FMC) at Berjaya Times Square Hotel.
Also present were FMC president Datuk Tony Khor Chong Boon and vice president Donald Chan Sang Tat, and HKEV secretary general Thomas Chu and honorary advisor Edward Chan.
The event aimed to facilitate exchanges and opportunities for co-operation in the automotive industry, particularly in the EV sector, between Malaysia and Hong Kong.
Tang noted that in Hong Kong, the EV market had seen supercharged sales growth, with EVs making up over 70% of new private vehicle registrations in January 2024.
"Today, there are over 76,000 EVs (from none in 2014) in Hong Kong. The Hong Kong government has spent over HK$3.5 billion to build 140,000 units of residential home charging facilities," he said.
FMC president Datuk Tony Khor (left) and HKEV president Kent Tang
Meanwhile, Khor pointed out that the EV sector presented business opportunities in areas such as raw material supply, energy production, battery production and assembly, vehicle manufacturing, retail and after-sales services, charging infrastructure, and charging management software.
In his speech, Khor said Malaysia is a gateway to the Asean region (consisting of 10 countries in Southeast Asia) which has a population of 660 million, making it the third-most populous region in the world, following India and China.
"Asean is also the world's fifth largest automobile market," he said.
An Asean Statistical Brief on www.aseanstats.org also pointed out that the share of the productive working age population (20 - 59 years old) increased from 51.4% in 2000 to 55.8% in 2022, with the total number reaching 373.7 million in 2022.
Meanwhile, in a commentary in January 2024, Rajiv Biswas, Asia-Pacific (APAC) chief economist at S&P Global Market Intelligence, had said the Asean region is expected to remain one of the fastest growing regions of the world economy over the decade ahead.
Biswas had noted that Indonesia, which is already Asean's largest economy, will become one of the world's leading emerging markets over the next decade, with the size of its GDP (gross domestic product) forecast to rise from USD 1.3 trillion in 2022 to USD 4.1 trillion by 2035.
"Vietnam and Philippines are also expected to join the ranks of the world's largest emerging markets by 2035. Meanwhile Malaysia is set to become one of the advanced economies of the APAC region, with its per capita GDP projected to reach US$26,000 by 2035," he said.
Biswas opined that consequently Asean, together with mainland China and India, will be one of the three main growth engines for the APAC economy over the next decade.
Regarding the growth of the electric vehicle (EV) market in Asean, Khor said there is rapid development as countries such as Indonesia, Malaysia, Singapore, Thailand, the Philippines, and Vietnam have introduced supportive policies and incentives for EVs.
"The sales of pure EVs in Malaysia grew by over fourfold in 2023, from 3,127 units in 2022 to 13,257 units; and the government aims to have 10,000 charging stations by 2025," said Khor.
He also pointed out that starting from January 1, 2022, the Malaysian government had implemented tax incentives for imported and locally assembled pure EVs.
These include duty exemptions for fully imported and locally-assembled EVs till end-2025 and end-2027 respectively.
Also, import tax exemption for components used in local assembly of EVs are till end-2027.
Under the Malaysian government's Budget 2023, EV charging equipment manufacturers get 100% income tax exemption for assessment years 2023 to 2032, as well as 100% investment tax allowance for five years.
Also, companies that rent EVs get tax deductions (maximum eligible rental amount is RM300,000).
