KUALA LUMPUR (May 21): Joined in the ambition to advance the automotive sector within Malaysia and the broader Asean region, consulting firm PricewaterhouseCoopers (PwC) Malaysia signed a memorandum of understanding (MOU) with the Malaysia Automotive Robotics & IoT Institute (MARii) at the inaugural PwC Asean Automotive Conference 2025, held at the M Resort & Hotel on May 19.

This collaboration is a knowledge partnership aimed at advancing the automotive sector in Malaysia both globally and within the broader Asean region, as well as bolster Malaysia’s initiatives and leadership as Asean chair, by delivering data-centric insights that underpin Malaysia’s automotive policy formulation and investment strategies.

“We hope this partnership can help play a role in strengthening our country's position as the regional hub for mobility innovation, especially during this time where Malaysia assumes the Asean chairmanship,” said Nurul A’in Abdul Latif, the executive chair of PwC Malaysia.

At the conference, PwC Malaysia shared its latest insights into the Asean automotive sector, including current strategies, investments, megatrends and policies. Industrial key players joined to discuss the latest strategies redefining the industry and how the automotive sector is going through a period of reinvention.

During the presentation on PwC’s latest findings in the global mobility landscape, its Global Automotive lead, Harald Wimmer highlighted that across the globe, four key megatrends are driving major transformations across the automotive sector: Climate change, technological disruption, a fracturing world and societies under pressure.

“Climate change is pushing us all for decarbonisation, which is accelerating the shift to electrified propulsion,” said Wimmer.

Technological disruptions like artificial intelligence (AI), machine learning and robotics are reshaping how automotive companies operate, accelerating the development of software-defined and autonomous vehicles.

Meanwhile, the fracturing world due to factors like tariffs and market volatility, as well as societies being under pressure from issues like labour shortages or changing market demands, has pushed companies to collaborate with once-unlikely partners and re-evaluate their supply chains, moving from a global market into regionalisation, which Wimmer argued is one of Asean’s biggest beneficiaries in its development..

The effects these trends have on the market are reflected in how many car manufacturers still struggle to meet pre-Covid-19 pandemic sales figures. But Chinese brands have, by contrast, seen great growth, with electric vehicle (EV) brands like BYD and Chery seeing over 200% increase in sales. The only comparable Western brand in terms of growth rate is Tesla.

Patrick Ziechmann, the lead of PwC Asean Automotive, said in his presentation on the Asean perspective that due to each nation within Asean having different macroeconomic factors, market growth is not even between states. Within the core six nations of Asean, Malaysia, Indonesia and Thailand are currently the most prominent automotive markets in the region.

“Malaysia has more than 760 cars per 1,000 adults, and this is a very impressive number not only in the region, but globally. We have already seen the [sales] figures for Malaysia... and Malaysia for two years is the second-largest market in Asean, with Indonesia as the biggest market and Thailand the third-biggest market in terms of sales,” said Ziechmann.

However, within Asean the total industry volume of automotive units sold had fallen for the first time since Covid-19, at 3.3 million in 2024 compared to the 3.5 million the year prior.

“The main driver for this dip is Indonesia and Thailand. Last year, the Thai market decreased by 25%, and this is mainly because of the huge household debt in Thailand. 

“90% of GDP in Thailand is actually the amount of household debt, which makes it the highest number in the region and one of the highest globally. This is why the banks were asked to restrict their lending, and therefore, the market in Thailand is dropping so deeply,” said Ziechmann.

This presentation was later followed by the lead of PwC China Automotive, Jun Jin, who shared insights into China’s perspective in the automotive sector.

“China is the single largest country now in all of the industry in terms of production and sales, we’re talking about 30 million sales volume in China. But if you’re looking at this number, the key thing is not only the total volume in China, but more importantly, we are moving to the new generation of vehicles,” said Jin.

This new generation of vehicles in China is called SEV (smart electric vehicle). Jin noted that Chinese brands are currently looking at how to make cars smarter and open to include new technologies to transform how cars are designed.

Examples Jin highlighted is how the cheapest car model in China comes with level 2 autonomous driving. Another type is Range Extended Electric Vehicles, hybrids where the main engine is the EV battery and the traditional ICE (internal combustion engine) is used as a backup or to charge up the battery, tackling range anxiety concerns with EVs.

After the presentations, the conference held a series of panels that brought industry experts to talk about the current automotive climate and what companies are doing to navigate it, with the first panel focused on the Asean market.

Klaus Landhaeusser, CEO of Adient, noted still lingering challenges European companies face when doing business in Asean as a collective. This is primarily due to how, unlike Europe, the countries in Asean are in different stages of development with their own trade policies and local standards. This has led to many trade barriers being built up between Asean nations, which makes trade across the region difficult.

“Cross-border shipment is one [example], especially with logistics and customs procedures. Countries like Singapore and Malaysia are pretty good [with this], but we have lots of different procedures in other countries which are still causing lots of trouble and losing precious time,” said Landhaeusser.,” said Landhaeusser.

Norhizam Ibrahim, the executive director of manufacturing development of Malaysian Investment Development Authority (Mida), pushed back on this focus on regulations. He noted that the governments in Asean states like Indonesia, Thailand and Malaysia are working and strategising together.

“[Asean] has a common platform for us to promote economic integration and look for further reduction of tariffs and other trade barriers between countries,” said Norhizam.

Norhizam argued that it is also up to how automotive companies strategise their investments.

Foreign automotive players are not going to invest in only one country, it will depend on a variety of factors like location, policies or talent. This encourages Asean countries to compete for foreign investments, which creates jobs, technology transfer, export commissions and infrastructure development.

The second panel of the conference focused on electric and shared driving, bringing the focus onto the rising EV ecosystems and autonomous vehicles in the region, where automotive players shared their experiences in offering EVs in the country.

Adeline Lew, general manager of BYD Sime Motors, noted that while EV sales grew from 0.2% of total car sales in 2022 to 2.5% in 2024, more work needs to be done. Part of this is addressing a skill gap in the EV space. Adeline noted that because EVs are still so new in Malaysia, many still do not know how to sell or service EVs and have to be trained from scratch.

A common theme in the panel was that for the EV ecosystem to grow, a collaborative approach was key.

Shah Yang Razalli, deputy CEO and chief green mobility officer of Gentari, noted that within the charge point operators (CPOs) space, competition has to be set aside, as the long-term viability and profitability of charging stations are tied to their utilisation.

“CPOs rely on the steady growth of electric vehicle adoption over a period of time and the growth of the utilisation after. Therefore, for CPOs, it's key that we see a sustained EV adoption over a period of time… It needs to be a long-term one; in this area, the competition will take a backseat. Collaboration is extremely important in driving EV adoption,” said Shah.

Meanwhile, financing institutions are pushed to take a more proactive approach. Chen Mian Ying, the executive director and head of industrial sector solutions at UOB Singapore, highlighted how UOB actively works with car brands and ecosystem players to form a network to bring new value to their clients.