Journey towards greener roads via EEV ahead of schedule — Analysts
KUCHING: The journey to greener roads through the 2014 launched Energy Efficient Vehicle (EEV) program, that aims to position Malaysia as a manufacturing hub of energy efficient cars in the region, is ahead of schedule as local EEV penetration has improved from 42.8 per cent in 2016 to 52 per cent in 2017.
According to MIDF Amanah Investment Bank Bhd (MIDF Research), actual EEV penetration rates for both years were ahead of their targets of 40 and 50 per cent respectively.
Moving forward, the research arm also guided that the Malaysia Automotive Institute (MAI) would be targeting EEV penetration to increase further to 60 per cent this year.
“EEV production is expected to increase 13 per cent to 350,000 units this year (and) Datuk Seri Mustapa Mohamed, Minister of International Trade and Industry (MITI) also highlighted of possible one new vehicle assembler setting up shop here this year,” guided the research arm.
To date, the EEV program with the help of customised government incentives such as duty rebates has successful attracted 19 original equipment manufacturers’ to offer EEV-qualified models into the Malaysia market.
The models that quality for such incentives are all required to be produced local and the extent of incentives given to them depends on the value-add that they bring to the local economy such as critical part localisation, research and development (R&D), exports and job creation.
Looking at the whole of the automobile industry, the MAI is understood to be targeting a total industry volume (TIV) growth of 2 per cent year over year (y-o-y) to 586,000 to 591,000 thousand units in 2018 from the 575,000 to 580,000 base units seen in 2017.
In comparison, MIDF Research’s 2018 TIV growth target is slightly lower at 1.7 per cent y-o-y.
“While TIV growth forecast is not entirely exciting, FY18F sector earnings will be driven by margin expansion from a stronger ringgit and a roll back in discounting as inventory pare down in the system stabilises,” said the research arm.
Additionally, the automotive sector is also expected to see solid performance for vendor development and parts and component exports as well in 2018.
“We would like to sincerely thank the management of KLK for the support and commitment towards the implementation of MSPO certification. We strongly believe that this serves as a huge motivation for Malaysian Palm Oil Certification Council (MPOCC) to further strengthen and implement the MSPO Certification Scheme in cooperation and collaboration with all the relevant stakeholders in Malaysia.
“We hope that other large oil palm companies will match KLK’s effort and commitment, and obtain certification as soon as possible before the mandatory implementation of MSPO certification by December 2019,” shared by MPOCC.
The MSPO standards provides general principles for the implementation, establishment andimprovementof theoperational practices of a sustainability system incorporated in Malaysia to ensure the sustainability of palm oil.
This certification standard currently covers the oil palm industry supply chain comprising independent and organised smallholders, plantations and POMs. It also includes grouping smallholders into Sustainable Palm Oil Clusters (SPOC) or other group management systems.
Certification of palm kernel crushers, refineries and palm biomass and biofuel plants will be implemented once the standards are ready. — Bernama