The brewing EV price war in Malaysia leaves many questions with no real answers thus far.
With the EV price war in China having been raging on for quite some time now, there was some speculation as to whether this phenomena will be making its way over to Malaysia. Well speculate no more anymore, as the cost cutting battle in the EV realm is well and truly here as well!
A Bird’s Eye View Of The Battlefield
But just before going onto the inevitable discussion to be had regarding its implications, let’s instead take some time to get a better picture of this ongoing war first. And on this front, while there may be some disagreement regarding the exact battle lines, the common consensus is for there to nevertheless be three major EV price-based prized fights going on over here, which are currently taking place in the sub-RM 100,000 hatchback, sub-RM 150,000 crossover and sub-RM 190,000 sedan classes.
Starting off with perhaps the most calm fight here first, the sub-RM 100k electric hatchback category sees for the upstart MG4 taking on the (relatively) old-hand BYD Dolphin, as the Neta V twiddles its thumbs ringside. Now the battle here is said to be the most civil because of the RM 100k floor price that fully imported cars can’t limbo under, but the arrival of these two smaller hatchbacks at those prices is still somewhat sufficient in keeping the current purveyors of B (or self-proclaimed C-)segment sedans up at night.
Moving onto perhaps the most openly bloody of the three fights brewing meanwhile, those currently duking it out in the sub-RM 150k e-crossover centre court arena includes the heavyweight BYD Atto 3 (incidentally Malaysia’s best-selling EV in 2023), the upcoming MG ZS EV and hot new Chery Omoda E5. The gauntlet in this particular battle was first thrown down by the Omoda E5 and its staggering RM 146,800 launch price that undercut its initial estimate of RM 160,000, with said gauntlet then picked up again by BYD, who just recently announced a staggering RM 20,000 rebate on 2023 models of its Atto 3.
As for the sub-RM 190k e-sedan feud on the other hand, this particular battle has more to do with behind the scenes machinations than outright open price-based warfare. Such is as the unashamed titan that is Tesla currently holds court with its Model 3 priced starting at the headline RM 189,000, while everyone else — smart, BYD, GWM Ora and to an extent even the more premium marques like Volvo — steadily massaging the list prices of their own offerings to match (or even beat) that figure.
To The Winner Goes The Spoils
Having since established the battlefield, it is probably time now to discuss the course of the war. And unfortunately for anyone here looking at some insightful analysis, there is to be a bit of a problem with that…
Such is because the constant ebb and flow of these battles essentially will render any comment of an eventual victorious party made at this time of writing to possibly age rather like milk left out in the sun when the dust finally settles. Especially as there are still a few new players that have yet to enter the scene too.
It is perhaps prudent to highlight here too that while using other markets may seem plausible, the unique way our local auto sector does things may see for the success of brands in other countries not really be replicated over here.
Though having said that, it is not too hard to discern the current victims of this local price war. And while it is probably bad taste to act like condors circling the sky above its next prey, it is nevertheless to be an undeniable statement of fact for the various legacy automakers *cough Hyundai, Kia, Jaguar, Volvo, BMW, MINI, Mercedes-Benz et al. cough* to currently be offering some staggering deals on its all-electric offerings in its (albeit quietly) desperate attempts to shuffle them out the showroom door…
And thus, it can hence be concluded that much like how the weapons manufacturers are the overall winner of any armed conflict, there is also an unquestionable overall beneficiary therefore of this particular price war — the buyers!
(Well, for now at least.)
The Consumer Is The Overall Winner(…?)
With still another year to go on the EV tax incentives and with deals being thrown left, right and centre not just by the desperate, but also by the marques who are currently bullish enough in dreaming to corner the market too, now is probably the best time for any Malaysian to take the plunge to experience the all-electric life.
What more is that thanks to this frantic race to attract buyers, Malaysians also are currently at the peak of their powers to show it to the long-standing (and frankly complacent) legacy marques that they have to earn our patronage back. Too long have we been taken advantage of with skint kit but high prices for our cars over here, and this current influx of attractively priced newcomers into the market has indeed resulted in some old hands responding by not just offering more for less with their products, but also improving their customer care as well in a bid to retain its rapidly evaporating clientele.
Taking a step back however, this race to the bottom in prices may actually not be all that great in the long run for the consumer. Such is because even avoiding the overall macro-scale debate that could be had on the potential deflationary effects of lowered car prices may have on the general economy, there is to also the simpler problem of these steadily decreasing new car prices have when buyers eventually become sellers.
After all, while one of these attractively priced EVs may seem enticing now, there will be a real risk for it to cost more in the long run if prices continue to drop even further later on down the line. And let it be noted too that this is not to be constrained within the EV space, as the only way to make any used car even worth the hassle over these cheap new ones is when they are priced as such.
So Now What?
And thus it circles back to the original question regarding this local EV price war posed in the title of this article: So now what? And well, the frank answer to that is really: Who knows?
Now granted, that answer may have lead you to wonder if you have wasted your time reading up to this point, but truth be told, there is really no one out there that could tell for certain who will exactly be the victor of this overall price war, if there is even one sole winner in the first place. It is also equally uncertain too as to what may eventually happen in the used car market, especially when there is both the fact for used EV prices may actually go up once new EV prices skyrocket after the removal of those sweet financial incentives offered currently.
What is nevertheless certain however is that these next few years will feel like the Wild West when it comes to the local (and to an extent international) auto market, with everyone essentially rolling the dice with their next set of wheels in this rapidly evolving industry. So may we all live in interesting times ahead…
