Covid-19 might have dominated the headlines for 2020 and gave the impression that little else is happening around the world. That’s not true, especially in the field of clean energy and electric vehicles.
Earlier this month, Saudi Arabia, the world’s largest oil exporter, took delivery of the first 20 wind farm turbines for its 400 MegaWatt Dumat Al-Jandal wind farm – the largest clean energy project in the Middle East.
Saudi Arabia aims to generate 50 percent of its electricity from renewable sources by 2030. It's a very clear signal that the oil industry, while still relevant, will be reaching its peak soon.
The Kingdom has not only removed all fuel subsidies, but also added tax on petrol to curb consumption, an unprecedented move in a country famed for its oil wealth. Saudi’s Vision 2030 is one that is progressive, clean, and green.
One month earlier, USA’s Silicon Valley-based Lucid Motors launched the Lucid Air – the world’s fastest charging electric car – 32 km per minute of charging via a DC fast charger, or over 480 km after 20 minutes of charging in real-world conditions. The 2-motor all-wheel drive Lucid Air produces up to 1,080 hp, with a range of 832 km on a single charge.
Lucid Motors is funded by Saudi Arabia’s Public Investment Fund. In a way, Lucid Air is Saudi Arabia’s electric car.
The Saudis are building not just the infrastructure for clean energy supply, but also the right products to consume the clean energy generated.
When the Saudis say it’s time to move beyond oil, you better sit up and listen. Especially if you are Malaysia, and 20 percent of your GDP is contributed by the Oil and Gas sector.
Last week, we discussed about Hyundai’s RM 7.6 billion investment into Indonesia and Singapore, the latter will likely see the Ioniq 5 (concept car below) put into production in Jurong.
Indonesia wants to transform itself into an Arabia of the EV era by leveraging on its nickel reserves – one of the largest in the world, and has since banned exports of the rare earth metal so it can grow a domestic EV manufacturing industry.
Singapore has announced that it will ban petrol and diesel engine cars by 2040, and has gazetted 1,000 km of public roads for driverless autonomous vehicle testing.
So will this leave Thailand? Dubbed Detroit of the East, Thailand is the region’s largest car manufacturing country – 2.014 million in 2019 – and exports to more countries than any of the ASEAN member states.
It got to where it is today by honing a laser-like focus on developing policies aimed at attracting investments into its product champions – first pick-up trucks, and later A/B-segment ‘Eco Cars.’
But Thailand understands that this won’t guarantee its automotive industry’s survival into the next decade. It has since established a National EV Policy Committee, chaired by the Deputy Prime Minister, and consists as academicians and industry experts.
Thailand’s National EV Policy is framed with in a wider Thailand Smart Mobility 2030 roadmap, which seeks to produce 750,000 electrified vehicles, or 30 percent of Thailand's annual car output of 2.5 million vehicles by 2030.
Note that Thailand's policy makers group hybrid vehicles (HEVs) like a Toyota Corolla Cross Hybrid and Battery Electric Vehicles (BEVs) like a Tesla or Nissan Leaf collectively as electric vehicles (EVs).
The use of the term EV here does not necessarily mean BEVs, and the 750,000 target has been erroneously reported by many foreign media as referring exclusively to BEVs, which is not the case, as it also include hybrids.
To kick-start demand, the government has announced that between now until 2022, twenty percent of the government's budget for fleet vehicle purchase will go to BEVs, mirroring a similar announcement by Indonesia.
Thailand’s Board of Investment (BoI) have slashed excise tax for BEVs down to 0 percent, valid until 2022. After which, those that produce BEVs in Thailand and meet BoI’s requirements will only need to pay 2 percent excise tax, as opposed to a regular combustion engine passenger car’s 25 percent.
Chinese car maker MG wasted no time in introducing its MG ZS EV, which is now Thailand’s most popular EV, with 1,197 units registered in 2019, well ahead of second place Nissan Leaf’s 93 units.
The EV is currently imported from China but MG has committed to produce it in Thailand starting 2021. Rival Chinese carmaker Great Wall has announced a RM 2.9 billion investment into Thailand, which will include local production of hybrid and EV models.
The BYD, another household name for Chinese EVs, has a fleet of e6 operating in Thailand as VIP taxis, as are a number of electric buses.
Knowing that EVs is still a big leap for regular consumers, and that hybrids are a reasonable mid-way point, Thailand’s EV promotion policy encourages manufacturers to start with hybrids.
Excise tax for hybrids have been slashed to 4 percent, down from 25 percent, on condition that at least 4 key parts are manufactured in Thailand, including but not limited to – high voltage battery, traction battery, drive control unit, battery management system – within 3 years.
Manufacturing of electric vehicles must also commence 3 years after the hybrid model, and at least 1 key part of the EV will be manufactured locally.
Notice that the policy doesn’t differentiate between hybrid and plug-in hybrids. This is because Thai policy makers understand that if additional tax breaks are given to plug-in hybrids, CO2 emissions will actually increase if owners don’t charge them regularly.
The government will also be collecting a nominal levy of THB 1,000 (about RM 130) per hybrid/EV battery, to ensure that systematic disposal/recycling is done at the end of the battery’s service life. Owners will be paid a refund only after they disposed the used part properly.
Applications for BoI incentives closed in 2018, so what’s the outcome one year later?
BMW Group has opened a THB 500 million (RM 66 million) battery assembly plant together with its supplier Draxlmaier.
Mercedes-Benz has committed THB 340 million (RM 45.1 million) for a battery plant there, but progress is currently stalled due to disagreements on the number of imported EQC models that the company is allowed to import before local production begins.
MG’s local joint venture company SAIC Motor-CP will be putting in THB 1.29 billion (RM 159 million), while Toyota has earmarked THB 10 billion (RM 1.3 billion) – still pending approval from BoI but Toyota has already opened a battery recycling plant there, which will process not just Toyota/Lexus batteries, but also those made by other brands.
Mitsubishi Motors Thailand is putting in THB 20 billion (RM 2.7 billion), out of which 13 billion Baht (RM 1.7 billion) is for electric/hybrid vehicles, starting with the Outlander Plug-in Hybrid.
Nissan will be putting in THB 10.96 billion (RM 1.5 billion) while Honda will be pumping in THB 5.8 billion (RM 772.8 million).
Of course, not all of the 750,000 electric vehicles by 2030 target will come from cars. A bulk of the number will come from electric Tuk Tuks and single seater ‘last mile/first mile connection’ cars.
These single seater electric vehicles will serve as a link betweeen MRT/BTS stations and commuters’ final destinations.
Toyota is currently conducting trials with its Ha:mo, which is used by students and staff at the Chulalongkorn University to commute within the campus and to nearby bus and MRT/BTS stations.
Japan’s Fomm Corporation (Fomm is short for first one mile mobility) is already producing the Fomm One, a 160 km driving range single seater EV in Thailand at its THB 1 billion (RM 132.7 million) plant in Chonburi.
As for public charging infrastructure, that’s currently being looked into by Provincial Electricity Authority (PEA) and Electricity Generating Authority of Thailand (EGAT). The latter is currently gathering data with its own fleet to determine the optimum distance between charging stations and location.
The next question is, what will Malaysia be like in 2030? Are our politicians still going to be fighting over cabinet positions and who will become the next PM?
Are we still going to be talking about national cars like Proton and Perodua, or that yet-to-be named third national car company?
But never mind about electric vehicle policy. After 10 years, will we able to finally enforce basic traffic regulations?
In order for advanced concepts like driverless cars, shared commuter EVs, and public EV charging to work, there has to be collective adherence to traffic regulations by all road users. Automated and electrified systems require some level of adherence to basic standards of usage and maintenance.
So don’t just blame the government’s (lack of) direction, are we a group of civilized road users in the first place?
The government shows leadership on macro-level public and industrial policies, but it is the public’s collective behaviour and maturity of thinking will determine how progressive a country will be, not the government.
Today, I just saw a Perodua Viva driving over the centre divider like it's a Hilux (yea, I didn't know it was possible too), because the driver was too lazy to make a loop around the block.
Remember that we are democratic society, and the government we have put in place is a reflection of our collective values and priorities.
We can’t talk about advance concepts like driverless cars, mobility as a service, and low carbon society if you insist on double parking while shamelessly slowing down traffic flow just because you are too lazy to walk further, or is too cheap to pay a RM 1 parking fee, or see no need to stop at a pedestrian crossing.