It goes without saying that EV sales numbers are going to show a substantial increase in 2024 with major player Tesla having a full year of sales under its belt, but the spate of price reductions on EVs in Malaysia has to be worrying, not just for existing owners who must be feeling as if their pockets have been picked, but for new upstarts offering only EVs in their model line ups, the best laid plans could already be outdated.
Adjustments to the MSRP (Manufacturer’s Suggested Retail Price) aren’t unheard of in the car industry, but it is rare in the internal combustion age. Yes, there are always attractive promotions with discounts and other freebies, particularly during festive seasons or towards the end of year to clear excess inventory, but the MSRP is typically not messed with as it adversely impacts residue values of vehicles and consumer confidence of the brand.
Of course, competition is a great thing for consumers and there are now far, far better deals for EVs to be struck compared to just a few months ago, the more alarming sign is just how quickly sticker prices have retreated since some of these new EVs hit the road, most recently being Tesla and Smart models and the quantum of reduction aren’t chump change either. GWM also slashed prices earlier in the year while BYD is offering ‘rebates’ for 2023 stocks. Are sentiments that weak in Malaysia already? Is the global EV glut hitting home? Are EV margins actually that fat to begin with? Probably all of the above.
While this may be the new normal as far as EVs are concerned, where prices are constantly adjusted in hyper-competitive markets such as China, it should be pointed out that Malaysia is in the early ‘honeymoon’ period of EV adoption – where vehicle import and excise duties are fully exempted (till the end of 2025), with free road tax thrown in. Yet the EV market share is likely to remain in single-digit percentage, even if you set aside 60% of the TIV typically dominated by Perodua and Proton, surely the novelty of an EV hadn’t worn off already?
Or maybe after the ‘oohs’ and ‘aahs’ of a speedy traffic light getaway and self-pacifying back slaps for saving mother earth, Malaysian consumers are now an enlightened bunch who are able to objectively comprehend the benefits and limitations of EVs despite the disproportionately rosy media coverage on all things EV-related. Maybe Akio Toyoda is right, you don’t put all your eggs in one basket.