Vynn Capital highlights Southeast Asia’s mobility evolution with its Mobility Market Trends in Southeast Asia 2024 report

• Electrification drives growth amid affordability challenges
• Collaboration key to solving mobility barriers in the region

Vynn Capital Sdn Bhd launched its Mobility Market Trends in Southeast Asia 2024 report in Kuala Lumpur last week. The report spotlighted key issues and transformative opportunities within Southeast Asia’s mobility ecosystem, emphasising innovation in electric vehicles (EVs), ride-hailing, and venture investments across the mobility supply chain including in battery charging and storage.

A panel discussion was held with panellists Yuki Tan, Head of Mobility & Corporate Venture Fund at Sime Darby Bhd; Eric Cheng, CEO and co-founder of Carsome Sdn Bhd; and Victor Chua, founding & managing partner of Vynn Capital Sdn Bhd. The session was moderated by Karamjit Singh, founder of Digital News Asia Sdn Bhd.

Strong govt support drives electrification in Thailand, Vietnam amid affordability challenges

Explaining Vynn’s goals for the report, Chua said, “Mobility is evolving rapidly in Southeast Asia. Our report identifies key factors driving this change, such as urbanisation, electrification, and investment trends.”

The findings pointed to Vietnam and Indonesia as emerging hubs for electrification technologies like electric motorbikes and battery swapping. Chua noted that these markets benefit from strong government support and growing consumer demand for sustainable transportation solutions.

However, affordability remains a significant hurdle across the region. Cheng emphasised, “Even with tax incentives, EVs in Malaysia start at just over US$22,400 (RM100,000) — out of reach for many consumers.” He also highlighted infrastructure gaps, with charging stations concentrated in urban areas and insufficient coverage elsewhere.

He flagged challenges in EV resale markets, particularly in Thailand, where battery lifecycle concerns hinder the growth of second-hand sales. “The second-hand market is critical for overall adoption, and current issues are slowing that progress,” he said.

Tan emphasised the need for long-term strategies to address these challenges. “Our focus at Sime is on building the EV ecosystem, including aftermarket solutions and battery recycling.” Sime is exploring ways to strengthen EV affordability through partnerships and investments in supply chain improvements.

Corporate ventures driving mobility innovation

As a regional leader, Sime has played a pivotal role in mobility innovation. Tan shared that Sime accounts for approximately 60% of EV car sales in Malaysia, underscoring its dominant market position. Additionally, it has invested US$15.68 million (RM70 million) into mobility-related startups, both direct investments into SOCAR, Carro, CarExpert, and Carwow and as a Limited Partner into two VCs, ie Vynn Capital and Gly Capital, to support innovation across the EV ecosystem.

Tan highlighted the importance of addressing key challenges, such as poor EV residual values and battery post-warranty period, which remain barriers to widespread adoption. Referring to her own EV experience, she described its second-hand value as "disappointing."

To mitigate range anxiety—a significant concern among consumers—Sime launched KINETA, a spin-off that provides home and private charging solutions. This initiative complements public charging infrastructure and aims to ease EV adoption for first-time users.

Ride-hailing and market opportunities

The report highlighted ride-hailing as a promising segment within the region’s mobility market. Increasing urbanisation and traffic congestion have driven demand for alternatives to private vehicle ownership. Cheng explained how Carsome collaborates with ride-hailing companies to expand its vehicle sales and leasing business. “Ride-hailing aligns well with our broader ecosystem strategy,” he said.

Investments in ride-hailing and related technologies could bring long-term growth, though Chua emphasised that sustained funding will be necessary to maintain momentum.

Chua noted that startups are well-positioned to drive innovation. “Incumbent industry players are not agile enough to implement changes quickly without risking cannibalisation of their current business. At the same time, driving innovations require huge investments by them and carry significant opportunity costs.” In contrast, startups, being nimbler, can make decisions faster and focus on innovation, he said.

Collaboration key to solving mobility barriers

The panellists agreed that collaboration between private investors, startups, and governments is critical for addressing systemic barriers. Chua emphasised, “A unified strategy can unlock new opportunities. This report is our contribution to that dialogue.”

Tan highlighted the importance of coordinated efforts to address charging infrastructure gaps and affordability. “Solving these challenges requires everyone - from governments to corporates - working together.”

Cheng echoed these sentiments, stating that partnerships with technology providers could further reduce costs and increase accessibility. Collaborative efforts will play a key role in accelerating innovation and adoption across the region.

Looking ahead

Southeast Asia is well-positioned for mobility growth, with a young, tech-savvy population and supportive government policies. The report emphasises the importance of sustained investments, strategic collaborations, and unified policy frameworks to overcome challenges in affordability and infrastructure. Leveraging these strengths, the region can establish itself as a global leader in electrification and mobility innovation.