In October 2020, Hyundai started
construction of a RM 1.22 billion, 30,000 electric vehicle a year plant in
Jurong, Singapore. When completed in 2022, the Hyundai Mobility Global
Innovation Centre (HMGICs) will be the Hyundai Motor Group’s (which also
includes Kia) regional hub for electric vehicle (EVs) production and
development. Out of the 30,000 EVs to be built there, about 5,000 to 6,000
units will be sold in Singapore, while the rest will be exported (Hans, www.wapcar.my).
Why did Hyundai choose Singapore instead
of Malaysia when Singapore’s wage structure is high? Even more surprising is
that Hyundai Motor has a 15 percent stake in the Inokom assembly plant in Kulim
but chose to overlook Malaysia and picked Singapore and Indonesia.
Malaysia sold 2,256 units of Hyundai
cars in 2019, far below Singapore’s 5,618 units but more than Indonesia’s 1,365
units. Hence, the sales volume is unlikely to be a factor on Hyundai’s decision.
What attracted Hyundai is the push for
electric vehicles in Singapore and Indonesia. Singapore is phasing out
combustion engines by 2040 and has established test-bed zones for autonomous
vehicles. Singapore has also gazetted 1,000 km of roads to test autonomous
vehicles in real-world driving conditions.
In January 2018, the Hyundai Motor Group
invested in Singapore’s Grab and started rolling out EV variants of the Hyundai
Ioniq. By November, Hyundai invested RM1.04 billion into a South East Asia-wide
EV partnership with Grab. Grab has also launched its GrabCar Elektrik service
in Jakarta and will roll out 500 units of Hyundai Ioniq EV there.
Hyundai knows that it will be difficult
to get consumers to migrate to EVs in a big manner, and this is where Grab
comes in. Car sharing, e-hailing, even driverless taxis are logical, more
acceptable touch points to get consumers become familiar with EVs.
Indonesia holds 25 percent of the
world’s nickel reserves, a crucial element in the manufacture of high voltage
batteries for EVs. Their President, Widodo, wants to establish Indonesia as a
centre for EV batteries and vehicle manufacturing, targeting to see 2,200 units
of EVs, 711,000 units of hybrids, and 2.1 million units of electric motorcycles
in Indonesia by 2025.
Since January, Indonesia has banned
exports of nickel. This is despite protests from mining companies. The
Indonesian government is showing great resolve by putting its foot down in
prioritizing their country’s longer term good.
In future, cars are less likely to be
purchased and owned privately but will evolve into a shared or subscribed
service. Mobility as a service is the keyword here, which is why Hyundai isn’t
too bothered about its present low sales in Indonesia and Singapore. Their priorities
are forward thinking government policies and a rich pool of intellectual
technical talent.
Apart from Hyundai, Toyota, BMW, and
Mercedes-Benz too have completed their electric/plug-in hybrid vehicle battery
plants in Thailand. Where is Malaysia? As the only Asean nation with the
capability to fully design, engineer and manufacture cars from the ground up,
shouldn’t Malaysia be at the forefront of this EV charge in the region? The
National Automotive Policy was announced on 21 February 2020. It has a lot of
new policies and ambitions—next generation vehicles, mobility as a service and
Industrial Revolution 4.0. It is now close to a year. Lots of MoUs signed but
no actual development. Is that Malaysia?
References:
1.
Hans,
The Malaysian link behind Hyundai’s decision to build this sexy EV in
Singapore, www.wapcar.my/
2.
Daniel
Fernandez, Why isn’t Malaysia leading the charge in EV development? www.freemalaysiatoday.com/
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