PETALING JAYA: With automakers taking on the global initiative to achieve carbon neutrality by 2050, UMW Toyota Motor Sdn Bhd is already on its way to achieve that goal.

       UMW Toyota Motor Sdn Bhd president K. Ravindran says the company plans to introduce more hybrid and electric vehicles to the market as demand and popularity for such models continue to gain momentum.

       “From this year, we plan to introduce a hybrid and an electric vehicle, on top of the cars with internal combustion engines (ICE) that we offer,” he told StarBiz.

       UMW Toyota has already started the ball rolling with the introduction of its all-new Toyota Corolla cross hybrid electric, which it introduced in January this year.

       “The model, which is locally assembled, has been very well received,” says Ravindran.

       Year-to-date March 2022, the company has sold 4,000 units of the Toyota Corolla cross hybrid electric and ICE variant, which was launched last year.

       “Next year, we’ll be launching another hybrid, but the concentration of UMW Toyota will be more on electric cars,” says Ravindran.

       He notes that the government has also been promoting the sales and demand for such vehicles.

       At Budget 2022, which was tabled in October last year, the government announced that it would provide full exemptions on import and excise duties and sales tax, as well as road tax (up to 100%) for electric vehicles.

       Individual income tax relief of up to RM2,500 will also be given on the costs of buying, installing, leasing or repayments of electric vehicle charging facilities.

       According to the latest data by the Malaysian Automotive Association (MAA), a total of 508,911 vehicles were sold in 2021.

       Of these, only 274 units were electric vehicles.

       While no projection has been given, the MAA is confident that sales of electric vehicles for 2022 “will be a lot higher,” especially in light of the tax exemption.

       The difference between a hybrid and an electric vehicle is how each is powered.

       A hybrid vehicle alternates seamlessly between electric energy and a blend of petrol and electric power, while an electric vehicle runs solely on battery power alone.

       Ravindran says there should be more awareness of such vehicles in Malaysia.

       “What’s important is that we need to conduct studies and testing to ensure that customers are ready to receive these products; and that we are also ready to deliver these products.”

       Going forward, Ravindran pointed out that hybrid and electric vehicles would be the future of the automotive industry.

       “In about five years, we expect to see a major shift towards there being more electric cars on the road,” he says.

       UMW Toyota Motor is the assembler, marketer and exclusive distributor of Toyota and Lexus vehicles in Malaysia.

       It sold a total of 72,394 units of Toyota and Lexus vehicles in 2021, giving the company a 14.2% market share of the total industry volume (TIV).

       The sales performance last year also helped UMW Toyota regain its leadership of the non-national car segment.

       For 2022, UMW Toyota is targeting to sell 73,000 vehicles, on the back of improved economic conditions and the extended vehicle sales tax exemption.

       “Year-to-date March, we have sold 22,447 units, which gives us an estimated market share of 14.6% of TIV,” says Ravindran.

       The company’s best seller is the Toyota Hilux, followed by the Vios, Corolla Cross and Yaris models.

       Ravindran says UMW Toyota plans to launch a new completely-knocked-down model in the second half of 2022.

       “We also plan to launch a completely-built-up (CBU) version of the Toyota Majesty and one new CBU electric vehicle,” he says.

       Following two challenging, pandemic-hit years, Ravindran says he is optimistic about the local automotive industry for 2022.

       “The sales tax exemption will definitely help to spur sales. Toyota and the MAA have urged the government to extend it until the end of the year.

       “We feel that the economy is growing. Customers are more positive now compared with the last two years and they are coming out to buy more cars.

       “So, extending the tax holiday will help the industry,” he says.

       The vehicle sales tax exemption was announced in June 2020 under the short-term economic recovery plan or Penjana.

       Under the exemption, locally-assembled cars are fully exempted from the sales tax while for imported cars, the sales tax has been reduced from 10% to 5%.

       The tax holiday was initially supposed to last until the end of 2020. However, it was extended to June 30, 2021; and then again until the end of the year.

       During the tabling of Budget 2022 in October last year, the government announced that the sales tax exemption would be extended one more time until June 30, 2022.

       The multiple extensions were mainly due to the repeated lockdowns over the past two years, which disrupted business operations and prevented car buyers from being able to fully enjoy the benefits of the tax holiday.

       Ravindran says UMW Toyota’s sales target of 73,000 units this year is premised on the fact that the sales tax exemption will end in June.

       “If it’s extended, we think we can sell more than 73,000 units,” he says.

       Separately, Ravindran says UMW Toyota has its own financing schemes to assist its customers when purchasing Toyota vehicles.

       “We have Toyota EZ Beli, an easy hire purchase plan where customers can enjoy lower monthly instalments in the first three years of the loan tenure.

       “This is helpful for younger customers in their 20s and 30s where they have a household income of between RM5,000 and RM6,000. Currently, 20% of our sales comes from his scheme.”

       For potential purchasers of the Toyota Corolla cross hybrid electric, Ravindran says customers will have access to a unique, green financing scheme.

       “We work with a few of the banks and they come up with very competitive interest rates,” he says.

       UMW Toyota also has a vehicle subscription programme called Kinto One.

       The scheme allows a new medium to owning and driving a car without the hassles associated with the traditionally popular hire purchase method.

       Originating from the Japanese word “kinto-un,” which means “flying nimbus,” the programme comes with a fixed monthly subscription that covers registration of the vehicle, annual comprehensive insurance and road tax, periodic maintenance as well as preventive maintenance.

       The subscription period comes in either two years or three years and once the period is completed, the customer just needs to return the car and everything else will be taken care of.

       This frees the customer from the worries of residual value of the car and how to dispose of the vehicle.

       Ravindran says the concept of a vehicle subscription programme is still in its infancy stage in Malaysia.

       “Malaysians still are not used to this as they still prefer to own a car. But this scheme is the future.

       “We believe that it will replace the conventional financing scheme, so we need to make our customers understand the benefits of this kind of product,” he says.