- Malaysia has set its sights on becoming Southeast Asia’s hub for electric vehicle (EV) production, Prime Minister Anwar Ibrahim said.
- Welcoming the project, the prime minister said he would “ensure an attractive investment climate for automotive assembly especially for EV models that will surely make Malaysia an automotive production hub.
Malaysia has set its sights on becoming Southeast Asia’s hub for electric vehicle (EV) production, Prime Minister Anwar Ibrahim said as he welcomed a US$500 million investment by South Korean car giant Hyundai Motor to build a second assembly plant in the region.
Trade-reliant Malaysia has been seeking new investors and markets over the past year as widening tariffs tied to the US-China trade and tech wars rattled its solar industry and raised concerns over its crucial semiconductor sector.
Those fears have been sharpened by the re-election of Donald Trump, who has threatened blanket tariffs on imports to the US, especially on strategic sectors such as renewables and semiconductors.
In October, Malaysia joined Thailand, Indonesia and Vietnam as new partner countries of the Brics bloc led by China, Russia and India.
Anwar’s government announced on November 25 that Hyundai Motor will invest 2.16 billion ringgit (US$500 million) in its first Malaysian plant in Kulim in northern Kedah state.
The deal, announced during Anwar’s three-day official visit to South Korea, did not give a timeline for when operations will start at the plant, which will assemble up to seven different car models.
Welcoming the project, the prime minister said he would “ensure an attractive investment climate for automotive assembly, especially for EV models that will surely make Malaysia an automotive production hub for the Asian market” in an Instagram post, referring to the Association of Southeast Asian Nations.
Anwar said Hyundai’s investment, spanning energy-efficient and electric vehicles, would help strengthen Malaysia’s automotive ecosystem.
The Malaysian plant will be Hyundai’s second in Southeast Asia after it opened a factory in Indonesia in 2022 with an annual capacity of up to 250,000 units, including for its Kona Electric SUV model.
In July, Hyundai and LG Energy Solution launched Indonesia’s first battery cell production plant for EVs.
The announcement comes as Asian carmakers of vehicles running on petrol or gas pare back production in Southeast Asia, as buyers looking for new cars increasingly turn to EVs.