Boosted by tax breaks announced in Budget 2022, the electric vehicle (EV) movement in the country may be on the way, but an investment bank says it will take time for auto players, including those of the component/segment of spare parts supply, in order to fully define the strategies and their activities for the new direction of electrification.
In a report, Affin Hwang Capital said it expects the auto sector to consolidate over the next two years. He said that based on his channel checks with the automotive and auto parts companies under his coverage, each company is formulating its own strategies and initiatives to respond to the emerging landscape, as the New Strait Times reports.
“Over the next two years, we expect the sector to consolidate in order to find its place in the industry on the degree of involvement in manufacturing, assembly, distribution and the provision of after-services. sale within the electric vehicle supply chain. Additionally, we are also seeing growing support from other industry and energy players to implement electric vehicle charging infrastructure,” he said. declared.
The investment bank said opportunities within the electric vehicle supply chain ranged from locating critical components to electric vehicle interoperability centers as well as developing charging stations and its infrastructure.
Late last year, the government said it was identifying strategies to promote the electric vehicle industry in the country and was considering a number of specific initiatives, including those that would boost the development of electric vehicle ecosystem. This includes manufacturing critical components, setting standards to support the electric vehicle ecosystem, and encouraging research and development activities to develop local technologies.