Record investments recharge EV ambitions
AFTER over a decade of aspiring to become the regional hub for energy-efficient vehicles (EEVs), Malaysia is now seeing momentum pick up amid renewed policy focus and promising investment figures.
The country first outlined its vision 'to develop as the regional automotive hub in EEVs' in the revised National Automotive Policy (NAP) of 2014.
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The Star
25-05-2025
- The Star
Record investments recharge EV ambitions
AFTER over a decade of aspiring to become the regional hub for energy-efficient vehicles (EEVs), Malaysia is now seeing momentum pick up amid renewed policy focus and promising investment figures. The country first outlined its vision 'to develop as the regional automotive hub in EEVs' in the revised National Automotive Policy (NAP) of 2014.
The Star
24-05-2025
- The Star
Steering through automotive supply chain shifts: Malaysia's resilience in a volatile world
HOW time flies. We are already a quarter of the way into the 21st century. In that time, the world has endured a series of shocks. A global financial crisis, and several regional ones. Pandemics and epidemics – one of which brought economies to a standstill. Major geopolitical conflicts, each with deep humanitarian costs. What used to feel like rare events are now reminders that volatility has become our era's default setting. The past few years have taught us a hard truth: The world is no longer predictable. What once were isolated incidences, are now sustained events that reveal how deeply interconnected – and exposed – our global systems have become. Few industries reveal this truth more starkly than the automotive sector. In Malaysia, this reality came into sharp focus for the automotive industry. Long considered a stable contributor to our gross domestic product (GDP) and a core part of the Asean ecosystem, the sector has had to rewire how it thinks about resilience, localisation, and its place in an increasingly fragmented global economy. An industry interwoven with the world Automotive manufacturing has always relied on a cross-border choreography – one in which a component made in Vietnam is shipped to Thailand, paired with software from Japan, and finally assembled in Malaysia. The efficiency was remarkable. But when just one point fails, the entire system falters. Malaysia's automotive players have felt these ripples firsthand. Not from direct tariffs or embargoes, but from the shifting strategies of global suppliers and logistics networks. Suddenly, questions that were rarely considered – 'What if a key supplier halts operations?' – have moved to the centre of boardroom conversations. Shifting from cost to continuity Where once the goal was to lower cost, today it's to lower risk. The automotive sector is beginning to pivot: exploring dual sourcing, reshoring critical parts, and embracing more regionalised models of supply. Supply chain resilience is no longer a 'nice-to-have' – it's a prerequisite. To support this shift, Malaysia's National Automotive Policy (NAP 2020) has laid important groundwork. It emphasises the development of a competitive and sustainable automotive industry by encouraging local component manufacturing, promoting technological advancements, and enhancing supply chain resilience. These include incentives for investment in local research and development (R&D), along with the adoption of Industry 4.0 technologies to improve efficiency and visibility across the supply chain. But policies take time to mature. Real progress hinges on execution. Three Paths to Resilience 1. Regional sourcing and collaboration. By tapping deeper into Asean's collective strength, under the Asean Free Trade Area (AFTA), Malaysian players can reduce exposure to distant disruptions. Shared production hubs, aligned quality standards, and streamlined cross-border trade offer practical ways to secure supply while boosting regional competitiveness. 2. Technology for transparency. More manufacturers are adopting predictive analytics and digital twins to model supply risks before they happen. What used to be a black box – the logistics chain – is becoming a dashboard, allowing for more informed, faster decisions. 3. Redefining local content. Localisation must now mean more than assembly. It means R&D, process innovation, and skilled labour development – all tailored to Malaysia's unique position. That's how we move from being an assembly hub to a knowledge and capability hub. Tariff war begins The imposition of tariffs by the United States under the current administration took many by surprise. While Malaysia's automotive exports to the United States are limited, the tariffs have a ripple effect across the global economy. A disruption at a single tier-one supplier in one country could have cascading effects down the supply chain, halting production lines thousands of miles away. Increased raw material and component costs, along with future uncertainties in trade relationships, will force manufacturers to revisit sourcing strategies and address vulnerabilities in the supply chain. Manufacturers want stability and predictability. More than low-cost sourcing, they seek partnerships with countries that offer sound policies, stable economics, and favourable tariff structures. Tariffs also affect adjacent industries – steel, composites, electronics, telecommunications – all of which feed into automotive manufacturing. Malaysia's manufacturers are still reliant on imported components, and that impacts both local assembly and export competitiveness. Building an adaptive industry So, what are we doing as an industry and economy to mitigate these shifts? Firstly, supply chain diversification. Manufacturers are actively seeking alternative suppliers in different regions to reduce single-source dependencies. This includes greater exploration of intra-Asean partnerships and new emerging markets. Secondly, digitalisation. The Covid-19 pandemic accelerated the adoption of real-time tracking, predictive analytics, and supply chain modelling. These tools help automotive companies gain visibility, anticipate disruptions, and respond more effectively. And thirdly, renewed focus on localisation. Government incentives are encouraging both foreign and domestic investments in component manufacturing. This reduces import reliance, creates local jobs, and strengthens the resilience of our export capacity. Talent, innovation and collaboration Localisation will further require, to future proof the transition, a robust talent pipeline. From R&D and manufacturing to after-sales service, human capital is key. Malaysia has long invested in technical and vocational education, and partnerships with automakers ensure that this ecosystem evolves in tandem with industry needs. We are home to a number of tertiary and vocational training institutes, many of which have allied with global manufacturers to generate a steady stream of talent. Localisation must be innovation-driven. It's not about replicating global models, but adapting them to our local strengths. Setting up at pace, scaling responsibly, and embedding quality – these are the new imperatives, and serve as encouragement to invest in increasing local content in locally assembled products. As a member of Asean, Malaysia sits within a regional automotive ecosystem, where our neighbouring countries compete with us to attract manufacturing and investment opportunities. But as the globalisation banner makes way for regionalisation, this opens up a slew of opportunities for collaboration. In complex automotive assemblies, such as a car dashboard, components may come from several countries, so having ease of trading and logistics between partner countries can save time and cost, shared growth leads to shared resilience, benefiting local industries. Conclusion Malaysia's automotive sector is already one of the most developed in Asean. It contributes 4% to GDP and supports over 700,000 jobs. We have one of the highest vehicle populations in the region – and we are not standing still. The disruptions we face are global. But our response must be local, regional, and forward- looking. The future of mobility depends not only on what we build – but how we build it, and who we build it with. In this, Malaysia is not just participating in the conversation – we're helping shape the next chapter. The views expressed here are the writer's own.
Barnama
20-05-2025
- Barnama
MIDA And Chery Forge Strategic Automotive Alliance, Marking A New Era In Malaysia's Automotive Sector
KUALA LUMPUR, May 20 (Bernama) -- The Malaysian Investment Development Authority (MIDA) and Chery Corporate Malaysia Sdn. Bhd. launched the Chery Premier Supply Chain Synergy Programme, marking a transformative milestone for Malaysia's automotive industry. The strategic initiative, held last Friday, hosted at MIDA's headquarters and supported by the Ministry of Investment, Trade and Industry (MITI) and the Malaysia Automotive Robotics & IoT Institute (MARii), brought together 12 leading Chery Technology suppliers from China and 23 Malaysian suppliers, creating a powerful platform for collaboration and growth. Datuk Sikh Shamsul Ibrahim Sikh Abdul Majid, Chief Executive Office of MIDA, highlighted the significance of the Chery Premier Supply Chain Synergy Programme in realising Malaysia's National Automotive Policy (NAP) 2020, 'This inaugural programme directly supports our commitment to fostering collaboration between Malaysian vendors and Chery China. We aim to unlock mutually beneficial opportunities that drive growth and innovation, aligning perfectly with NAP 2020's objectives of promoting local vendor development, supporting next-generation vehicles (NxGV), and incorporating Industry 4.0 practices. By fostering these vital links, we envision a future rich with technology transfer, streamlined supply chains, and enhanced industrial capabilities, ultimately benefiting both Malaysia and Chery.'
