Maybank Analyst Anticipate Rise In ASEAN EV Adoption Despite Global Slow Down

Analysts at Maybank Investment Bank (MIB) predict that electric vehicle (EV) adoption in ASEAN will continue to rise. Fostering this are favourable regulations, introduction of new EV models at lower prices by Chinese EV brands, and the establishment of the region's significant automotive production base and demand.

According to said experts, six ASEAN economies have seen a fourfold increase in electric vehicle (EV) sales, reaching 141,095 units in 2023, with Thailand and Vietnam accounting for 77% of the total.

Meanwhile, Indonesia had a 65% year-on-year increase with 17,062 EVs sold, while Malaysia experienced a whopping 286% year-on-year growth with 10,159 units sold.

Overall, in the six ASEAN markets stated above, EVs accounted for 6.2% of automobile sales in 2023, up from 1.6% in 2022. However, core to this is the availability of lower-cost Chinese EVs has made it harder for other Japanese and Korean brands to compete in ASEAN markets.

Moving forward, MIB believes that ASEAN's EV adoption rate will increase as more new and affordable EV models enter the market in 2024 and 2025. Additional direct subsidies and incentives for buyers, as well as the extension of public charging infrastructure, would accelerate this trend even further.

However, the subsidies and incentives vary by country, with Thailand offering cash subsidies and lower excise and import tariffs for OEMs and Indonesia decreasing duties and pushing towards domestic production to encourage EV sales. Back home in Malaysia, in addition to the ongoing EV tax breaks, news of an increase in fuel price owing to subsidy reductions appears to be a motivating factor.

Globally, electric car sales reached 14 million units in 2023, representing a 34% year-on-year rise and 19% of overall vehicle sales. However, a forecast indicates that EV sales growth in 2024 will decrease to 22% year on year due to market saturation in China and Europe, as well as uncertainty in the US ahead of the presidential election.