Malaysia is among the top 5 Volvo markets for EV adoption
By Hardesh Singh July 28, 2023
- 72% of sales in 2022 came from plug-in hybrids and full electrics
- No plans to invest in charging infrastructure, betting on improved battery range
Volvo Cars has set a bold electrification target and is aiming for pure electric cars to make up 50% of its sales by 2025, and to achieve 100% pure electric vehicles by 2030. It has stopped all production of internal combustion engine vehicles, with only plug-in hybrids and pure electrics featuring in its current model lineup.
Over two sessions, Sustainability Matters (SM) had the opportunity to speak with the Managing Director of Volvo Car Malaysia, Charles Frump (CF), as well as Anders Kärrberg (AK), the global head of Sustainability and Anders Nyth (AN), manager of Sustainability Centre at Volvo Cars.
The following interview has been edited for brevity and clarity.
SM: Firstly, we’d like to clarify whether the target of achieving 50% EV sales by 2025 is a global average or pegged to each market.
AK (pic, left): The target is across our global market, so individual markets might differ in their current progress and infrastructure, but we are aiming to be a 100% pure electric car company by 2030. We have stopped producing pure petrol engines and have a plug-in hybrid line but all the new cars that we launch going forward now are going to be pure electric.
SM: Where does Malaysia place as far as achieving the 50% sales target by 2025?
CF: So, at the moment, I think we're actually trending quicker than the rest of the world. If we look at our global vision, we've been very clear publicly that we want to be 50% pure electric by 2025 and to reach 100% by 2030. All our industrial systems are now set up for that. As for Malaysia, when we launched the XC40, we said that we would like to achieve 75% pure electric sales by 2025, and that's coming very quickly. Last year 72% of our sales in Malaysia were a combination of plug-in hybrids and pure electric vehicles. We are one of the top markets in the world when it comes to the adoption of full electrics and hybrids, probably third or fourth in the world across all our markets.
SM: Is that driven by customer demand? Do you see them preferring to go electric or is it because you're also stopping production of internal combustion engine vehicles and forcing a behavioural change?
CF: So, I think it's a bit of both. And I think especially with our customers, the impact that we have on the environment is extremely important to them and younger customers are becoming more discerning.
Regulations of course drive a lot of this, and customer demand also drives a lot of this. Most importantly though, this is who we are as a company and who we want to be. Volvo has been synonymous with safety, and now we are talking about safety for the planet which is a direction that is very natural for us.
AK: A lot of this also has to do with the overall culture of sustainability in each market. The uptake in Nordic countries and parts of Europe is much higher compared to other markets, but this also has to do with the availability of the infrastructure to drive confidence among consumers.
AN (pic, right): Our sustainability initiatives don't stop with emissions. Our forthcoming EX30 is designed to have the lowest carbon footprint of any Volvo car to date, and about a quarter of all aluminium used in building the car is recycled. Also, about 17% of all plastics in the car, from interior components to exterior bumpers, are recycled – the highest percentage in any Volvo car to date.
AK: Also, to add on, all our combustion engine operations have been spun out into a separate powertrain technology company together with Geely and Renault. This will allow us to focus on our electrification ambition while also ensuring existing owners of combustion engines access to maintenance and service.
SM: Is there still a cost consideration between owning an electric vehicle versus a petrol variant? Petrol prices in Malaysia are heavily subsidised, but that may change, especially for the higher income brackets, which make up your target market. At the same time, electricity tariffs also might increase for this group.
CF: You know, I think in general our customers are a little less price-conscious compared to non-premium car buyers. But of course, these things play into their decision. I've heard discussions about the possibility of electricity prices going up. Could that have an impact? I think what would have an impact is if petrol subsidies went away and petrol prices started going up and that quite honestly would lean into the direction we're going. How is this going to play out? No one knows yet. At the moment there's a significant cost savings when you shift to electric. Even if there was a small increase in electricity tariffs, I don't see that having a huge impact on us unless there’s a real reduction in petrol prices.
SM: Your main competitors have been announcing partnerships with energy companies to roll out public charging infrastructure. Volvo seems to be holding out. What’s the thinking here?
CF: Having now driven the XC40 and C40 for almost a year, you get to learn a lot about what it means to own an electric car. Our strategy is quite in tune with what I see when I drive an electric car which is that having the charging infrastructure at home is a big advantage. There have only been two times in the past year that I've had the battery level fall below 50%. The truth is, when you're driving an electric car, being able to charge at home is a huge enabler.
I never get below 50% and I think with the ranges that we have now, that is largely the case because you're leaving your home area with almost 100% charge. I don't see us building a big charging infrastructure. I see us leveraging the overall public infrastructure. We are certainly targeting early adopters with our new models - people who can have charging options at home. We also have DC chargers at all our dealerships for the benefit of our customers.
Experiencing a pure electric vehicle
I was loaned an XC40 for a week and took the opportunity to experience the main concern I hear among car buyers when considering an EV – range. Other concerns are battery longevity and how clean electric vehicles really are. We’ve published a separate story addressing these issues here.
I decided to limit myself to charging at home, and since I do not have a wall box, I was limited to 3-pin charging from a regular wall socket. I made it a point to use the car every day on what my typical commute and outings would be, as well as a day trip to Port Dickson.
I generally would end the day with about 60-70% charge left, and at that level, leaving the car to charge overnight using the 3-pin socket was adequate to provide me with at least 90% battery level every morning. It took some getting used to, having to gauge how quickly the battery drains, but after a couple of days one gets a better sense of the range available, and anxiety becomes less of a concern. I must admit that driving to P.D. on a single charge was a bit nervy, and I was constantly monitoring the battery level, but even then, I made it back with about 30% battery left.
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