KUALA LUMPUR: The Malaysian government is looking to boost production of electric cars in the country in an effort to promote a reduction in carbon emissions and boost its export trade in the industry, the government said. Although the government understands that other countries are ahead of Malaysia on producing greener vehicles, the country hopes that by boosting production in electric cars, it can quickly become a global leader as well as reduce emissions in the Southeast Asian country. At present, there are 11 completely electric vehicles on Malaysia's roads, according to government figures. Hybrid cars – which use both conventional fuel and an alternative power source for their engines – are more popular, with around 8,000 hybrid vehicles currently on the roads. This is set to change, however, with the government planning to announce a major policy shift that will promote the production and domestic use of electric vehicles. The highly anticipated revision of the National Automotive Policy (NAP), the government's long-term plan for the industry, will introduce several new reforms and regulations. Since late 2011, the Malaysian government has been promoting the establishment of a local electric vehicle manufacturing capacity. Both the government and industry lobby groups believe such a move will help broaden the base of the sector. According to projections from the Malaysia Automotive Institute (MAI), reforms to the industry, coupled with higher local and international demand, would see the sector's contribution to the economy triple by 2020. In a statement issued in early May, the MAI said it expected the industry's share of gross domestic product (GDP) to rise from the present rate of 2.4 percent to 6.8 percent, largely due to an increased focus on the production of electric and other energy-efficient vehicles. This growth would be underpinned by a higher level of foreign direct investment and government efforts to encourage original equipment manufacturers (OEMs) to set up operations in Malaysia. “Meeting vehicle standards for energy-efficient vehicles in Malaysia means bringing new technologies into the country,” Madani Sahari, the CEO of the MAI, told OBG. “As a result, OEMs are being targeted. “Before this happens, however, the sector must be liberalized by allowing both local and foreign OEMs to qualify for manufacturing licences, which is expected to happen with the pending second revision of the NAP,” Sahari added.
