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Tesla is the most recent EV firm to find success in Malaysia

KUCHAL LUMPUR On Thursday, Tesla formally began operating in Malaysia, joining other EV producers already present in the Southeast Asian nation that are jostling for investment to counter Thailand and Indonesia, which have been stepping up efforts to build their EV industries.

From 2016 to March 2023, the 58 EV investment projects worth 26.2 billion ringgit ($5.8 billion) have been approved by the Malaysian Investment Development Authority (MIDA).

These projects span vehicle assembly, part manufacturing, and charging component manufacturing. In the country, there are already around 1,000 charging stations, and 10,000 are anticipated to be completed by 2025.

The present government’s “support in forward-looking policies” for the sector, according to Isabel Fan, regional director for Tesla, is one of the primary reasons that the company chose Malaysia for its expansion. She also stated that the business’s goal is for Malaysia to be a part of the growth of the regional EV industry.

Fan praised Tesla’s ultra fast charging capabilities and said the business sees Malaysia as an ideal place to expand its booming network in the Asia Pacific, where it already has roughly 2,000 such facilities.

Malaysia will play a significant role in this development, she said. The business recently revealed a super fast indoor power source at a nearby mall.

As part of the nation’s BEV (Battery Electric Vehicle) Worldwide Leaders initiative, which was established by the government in March to encourage EV makers, the business is undertaking online selling of its Model Y and Model 3 in Malaysia and will soon open a head office and Tesla Experiences and Service Centre.

Both will be situated in Cyberjaya, a city close to Kuala Lumpur in the commercial state of Selangor. Additionally, the state is home to a number of foreign manufacturers and assembly plants run by companies like Toyota, Nissan, Honda, and Volvo. Mercedes-Benz, BMW, and Porsche all have factories there as well.

The third-largest automotive industry in the area, behind Thailand and Indonesia, is located in Malaysia. In 2021, the sector’s contribution to the nation’s GDP was about 4%, or 40 billion ringgit.

Chinese brands who Debuted in Malaysia

Three Chinese brands have debuted in Malaysia this year alone:

  1. BYD
  2. Great Wall Motor
  3. Chery

The Malaysian minister for investment, trade, and industry, Tangka Zafrul Abdul Aziz, praised Tesla for picking Malaysia as a location for its expansion.

The government official said in a statement that Tesla’s presence would help Malaysia’s pro-business and pro-investment image on the international stage.

We look forward to welcoming more foreign investors who share our goal of assisting our country’s development at a more viable, just, and equal rate” the official said.

The government’s job, according to Liew Chin Tong, Malaysia’s vice president for investment, trade, and industry, is to make sure that the entire EV ecosystem is as comprehensive as possible without favoring any particular company.

“There is a tremendous value chain to develop, and the appearance of Tesla is an impetus,” Liew said to Nikkei Asia outside the Tesla event.

As the first application to receive approval under the BEV programmed, Tesla will be able to sell vehicles in Malaysia without the need for an Approved Permit (AP), which will reduce the cost of imported vehicles.

On July 14, Elon Musk, the CEO of Tesla, spoke with Prime Minister Anwar Ibrahim via video chat on the company’s investments in Malaysia as well as SpaceX’s Starlink rural satellite service.

The government has given Starlink permission to provide satellite internet services and said on Thursday that it would purchase 40 sets of Starlink technology for use in educational facilities and other establishments.

In an effort to create and establish a local center in the Automotive High-Technologies Valley (AHTV), which is situated in Tanjong Malim, in the Malaysian state of Perak, Anwar announced on Tuesday that China’s Geely will make investments of $10 billion in Malaysia. Additionally, Geely is Proton’s second-largest shareholder. Proton is Malaysia’s official automaker.

According to Ong Kian Ming, director of Taylor’s University’s philosophy, politics, and economics programmed, Malaysia has a large number of skilled small and medium-sized businesses in the automotive parts industry, particularly automotive electronics.

A marketplace where other players will profit from the ripple effects is expected to see EV sales increase as a result of Tesla’s debut, he continued.

In a similar vein, Geely probably recognized the benefits Malaysia and ASEAN can offer the EV ecosystem, the speaker said, referring to the Organization of Southeast Asian Nations.

This is particularly so given that they are accustomed to being in Malaysia through their investments in Proton, whereas the Japanese players dominate Thailand” said Ong, a past member of government and deputy minister of foreign trade and industries.

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