TA Research analyst Angeline Chin emphasised the critical need for EV infrastructure development.
PETALING JAYA: While the revision of the road tax for electric vehicles (EVs) may be a step in the right direction, addressing infrastructure challenges, lowering price barriers and implementing supportive policies are essential factors in driving significant growth in EV sales in Malaysia.
TA Research analyst Angeline Chin emphasised the critical need for EV infrastructure development, highlighting that without an adequate number of charging stations, consumers may remain hesitant to embrace EVs.
“Now, even when it (road tax) is waived for EVs, the pick-up is not exciting because the infrastructure is not there,” she told StarBiz, adding that the lack of infrastructure remains the biggest challenge to drive the adoption of EVs.
Additionally, Chin pointed out concerns from the pricing point of EVs, noting that it is still not “affordable” for most locals.
“With EVs being priced above RM100,000, internal combustion engines (ICE) vehicles from Perodua and Proton will still be the preferred option,” she added.
Chin also expressed scepticism about a significant reduction in EV prices, noting: “I don’t think they will slash it to below RM100,000 until local manufacturers produce EVs.”
To note, both Perodua and Proton have expressed their commitment to launch their first EV by 2025.
Kenanga Research analyst Wan Mustaqim echoed the sentiment that current EV prices, starting from around RM100,000, remain a hindrance for many potential buyers.
“In terms of pricing, it (an EV) is still a bit pricey and the current price range is not attractive,” he said.
Similarly, Wan Mustaqim highlighted the importance of addressing infrastructure challenges, noting that improvements would likely follow the introduction of more affordable EV options.
“Infrastructure will progress much faster once affordable EV cars are available,” he said, highlighting that charging stations require a sufficient volume of EVs to become financially viable for investors.
With Proton and Perodua considering more affordable EV options, Wan Mustaqim believes the price range could be between RM70,000 and RM100,000, making EVs more accessible to consumers.
Despite the government’s annual revenue of RM3bil from road tax, the current contribution from EVs remains at 0% due to the exemption in effect until 2025.
Wan Mustaqim pointed out that EVs still represent less than 2% of the total industry volume (TIV), indicating their minor impact on revenue, even after the revision of the EV road tax structure.
However, he remains optimistic about EV prospects in Malaysia, anticipating notable advancements in charging infrastructure and policies with the introduction of affordable EV models from Proton and Perodua.
“When Perodua and Proton launch their EVs, we can expect significant improvements in charging infrastructure, friendlier policies and ultimately, higher EV sales,” he said.
To note, the Transport Ministry is in the final stages of reviewing the road tax rate structure for EVs, with further details set to be announced at the end of this month.
Transport Minister Anthony Loke Siew Fook has confirmed that the revision will result in the EV road tax being cheaper than that for ICE vehicles, aimed at encouraging more people to transition to EVs.
Currently, EVs benefit from a tax exemption on road tax until end-2025.
In Malaysia, the EV road tax is calculated based on the power output of the vehicle’s electric motor, differing from ICE vehicles, which typically have road tax based on engine capacity.
Beyond the 80 kilowatts (kW) threshold, where most EVs reside, the road tax calculation involves a base rate plus a progressive rate, ensuring that higher-powered EVs pay proportionally more in road tax compared to lower-powered ones.
For example, EVs with an output power ranging from 200 kW to 300 kW will see a road tax of between RM2,000 and RM4,500.
