GLOBAL demand for electric vehicles (EVs) has slowed, but the Malaysian car market, which is traditionally dominated by petrol vehicles, is now witnessing a gradual shift in interest towards EVs.
According to the fifth annual EY Global Mobility Consumer Index report, about 25 per cent of Malaysians are interested in buying an EV, driven by rising fuel costs and environmental considerations.
The report, which is based on 19,000 respondents from 28 countries, shows that Malaysia stands at a pivotal juncture in its transition to EVs.
While Malaysia shares common challenges with other countries, it also faces obstacles in fostering a robust EV ecosystem and generating mainstream consumer interest and demand.
"Early adopters in Malaysia, who have purchased an EV, cite environmental impact (53 per cent), rising cost of fuel (33 per cent), and wanting to 'look cool' (27 per cent) as their main reasons for buying one," the report said.
But with nearly 40 per cent of Malaysians saying they would prefer to buy an internal combustion engine (ICE) and a hybrid car next (20 per cent).
This unlocks the next phase of growth for full EVs, which will require car brands to appeal to a different type of consumer - who is younger, more cost-conscious, and motivated to make the switch due to rising fuel costs (43 per cent), environmental impact (35 per cent) and a more variety of EVs being offered (27 per cent).
Despite government incentives targeted at growing the EV market, with the aim of 15 per cent of new car sales being EVs by 2030, Malaysian consumers remain cautious, weighing the resale value of EVs (57 per cent), access to renewable energy for charging their EVs (51 per cent), and ongoing battery maintenance expenses (41 per cent).
Mark Bennett, EY energy customer experience leader for Asia Pacific, said EVs are the future of mobility, but the findings reveal that there is still a long way to go when it comes to addressing issues around infrastructure, range and battery replacement costs.
"A significant number of consumers remain skeptical about EVs, particularly on infrastructure and cost of ownership. These aren't new concerns.
"There needs to be a sustained effort across the ecosystem to address these concerns, otherwise we run the risk of turning consumers off EVs at a time when they should be getting more excited about them," he added.
The EY Global Mobility Consumer Index also underscores the critical role of charging infrastructure in building consumer confidence to switch to EVs, with 27 per cent of potential buyers citing insufficient charging points as a deterrent.
Concerns with public charging infrastructure include finding a charger (61 per cent), long wait times (53 per cent) and cost of charging using public infrastructure (38 per cent).
While these concerns are common across all age groups, they are more pronounced for boomers and Gen X.
As a result, many EV owners would prefer to charge at home (68 per cent), and for those who can, the experience is more positive (77 per cent satisfaction) with charging speed (79 per cent), installation costs (72 per cent), and incentives and rebates (55 per cent) being important considerations.
Chinese EV brands still need to gain consumer trust
Chinese EV manufacturers had made great strides in recent years in Malaysia and are starting to offer more options for consumers, with two Chinese brands now in the top 10 most popular new car registrations (as of August 2024).
It is the first time an EV brand has featured in the list.
The EY Global Mobility Consumer Index also reveals generational shifts in Malaysian attitudes.
With boomers and Gen X respondents ranking value for money as their primary reason for onsidering Chinese EV brands (68 per cent), whereas Gen Z shared concerns with brand trust (39 per cent) and preference for more establish manufacturer brands (39 per cent) as reason for not considering Chinese EV brands currently.
Bennett said while China leads the world in EV production, demand, and infrastructure, brand perception remains a challenge.
"The affordability and technology driving China's electric industry are arguably the global benchmark, however for many international EV buyers, their purchase is influenced by more than just price - it's also influenced by brand, service, quality and price residuals."