PETALING JAYA: The transition to electric vehicles (EVs) in Malaysia is inevitable as this is an emerging trend around the globe.
This is according to experienced bus manufacturer Gemilang International Ltd which makes and supplies EV buses worldwide.
To be sure, its view is echoed by many who cite increasingly supportive government policies, growing environmental concerns and EV batteries that are slowly getting cheaper, as reasons for this growing transition.
Gemilang chairman and CEO Pang Chong Yong said besides China, which is one of its main target markets, the company’s current orderbook suggests that Australia and the United States are also moving aggressively towards transitioning to EVs and the company expects to receive more orders for EV buses from these two countries.
“In Malaysia, the first introduction of EV buses was back in 2015, when Gemilang supplied bus bodies for 15 units of electric buses to Sunway’s Bus Rapid Transit (BRT),” he told StarBiz in an e-mail interview.
Another project was the supply of 10 units of bus bodies for Putra Nevo EV bus - Malaysia’s first Super Quick Charge EV for Putrajaya, he noted.
He said although Malaysia was earlier in its introduction of EV buses compared to nearest neighbour, Singapore, Gemilang had already supplied Singapore with more than 40 units to-date, surpassing the quantity sold to the Malaysian market.
“Hopefully the Malaysian government will finalise a development plan for EVs and start to electrify city buses soon,” Pang said.
Gemilang, which is Johor Baru-based and listed on the Hong Kong Stock Exchange (HKEx) meanwhile is planning to continue to ride on the growth of EVs, both here and globally whereby certain cities have already called for EVs to replace combustion engine powered vehicles.
However, its business which also includes manufacturing non-EV buses, is not shielded from the effects of the current Covid-19 pandemic.
“During a normal year before the pandemic, the company normally made about RM200mil to RM300mil in revenue with RM20mil to RM30mil in profit after tax,” said Pang.“However, in 2020, although the company’s orderbook was full then, it was unable to deliver attractive financial numbers as it was not allowed to operate during MCO 1.0,” he said.
“As a result, the company could not deliver the orders on time.”
“Still, in terms of the growth of the business, it can be safely said that the order of EV buses this year is more than double if not triple when compared to last year’s order.
“In other words, we foresee half of the company’s revenue this year coming from the EV segment,” Pang said.
According to him, the biggest challenge for EVs now was the infrastructure of charging facilities as well as power supply.
“These can be costly to build hence a series of supportive EV policies and relevant subsidies will play important roles to encourage the adoption of EVs,” Pang said.
On why the company chose to list Gemilang in Hong Kong instead of in Malaysia, Pang said:”HKEx is a well-established stock market internationally, compared to Bursa Malaysia.
“As our business focuses mainly on export markets, listing on the HKEx no doubt strengthens the brand of Gemilang and promotes the transparency of our operations to the markets.”
He said the company had no plans for now for a dual listing in Hong Kong and Malaysia, but if the opportunity comes about, Gemilang will consider it.
“Listing on Bursa Malaysia will definitely be beneficial to Gemilang especially in terms of exposure to local investors as Malaysia is our home ground,” he added.
In 2020, some 90% of the company’s revenue came from export markets.
“While we expect export markets to continue to be the main contributor of our company’s revenue, we hope to be given more local orders as we believe the circulation of EV buses in Malaysia’s cities will happen soon,” Pang said.
In the past decade, Gemilang has supplied aluminum buses to companies such as Rapid KL and Rapid Penang as well as manufactured the MRT feeder buses that are used across cities in the country.