KUALA LUMPUR (Oct 20): EP Manufacturing Bhd (EPMB) is establishing an automotive manufacturing facility in Melaka involving over RM100 million investment to cater for BAIC and Great Wall Motor (GWM) vehicles.
In a joint statement with the Malaysian Investment Development Authority (Mida) on Friday, EPMB said that the new facility will unfold in several phases at the HICOM Pegoh Industrial Park in Alor Gajah, Melaka.
Once fully operational, the facility is projected to create around 1,000 new job opportunities in the state.
Upon completion, the first phase of this new facility will have the capacity to produce up to 30,000 vehicles a year.
EPMB signed a memorandum of understanding (MOU) with BAIC International in August, paving the way for local production of BAIC's BJ40P and X55II sport utility vehicles (SUVs), right-hand drive internal combustion engine vehicles, and electric vehicles (EVs).
The group also expects to assemble vehicles for Great Wall Motor Sales Malaysia Sdn Bhd (GWM Malaysia), a subsidiary of GWM, at this plant, based on the MOU signed by both parties on Wednesday.
EPMB group chief executive officer Ahmad Razlan Mohamed said the establishment of an EV manufacturing facility is a pivotal step in realising the group’s vision of developing the EV supply chain for the Malaysian market.
“Collaborating closely with our strategic partner, BAIC, we are poised to construct a cutting-edge EV manufacturing facility in Melaka, heralding the commencement of the next chapter in our growth trajectory.
“Additionally, we are keenly looking forward to collaborating with GWM, our esteemed customer, in contributing to position Malaysia as a central hub for EVs and energy-efficient vehicles (EEVs) in the Asean region,” he said.
Mida CEO Datuk Arham Abdul Rahman said EPMB’s collaboration with BAIC is a testament to the latter’s confidence in Malaysia’s attractiveness as an investment destination, and underscores the nation’s cutting-edge automotive manufacturing capabilities.
“This new manufacturing facility, dedicated to EEVs and EVs, perfectly aligns with the Low Carbon Mobility Blueprint, National Automotive Policy 2020 and New Industrial Master Plan 2030 aspirations.
“These policies are rooted in harnessing opportunities in environmental, social and governance (ESG)-sensitive markets, and swiftly adopting technology to enhance the technological ecosystem of our manufacturing sector, and Malaysia’s commitment towards sustainable transportation,” he said.
EPMB received the approval for a manufacturing licence from the Ministry of Investment, Trade, and Industry on July 11, allowing the manufacture and assembly of four-wheel EEVs, EVs, and electric commercial vehicles.
Sale of two-wheel EV manufacturing unit's stake to CEO meant to comply with Miti's condition
In a separate statement, EPMB stated that the reason it is disposing a 70% stake in EP Blueshark Sdn Bhd, a unit that manufactures two-wheel EVs, to Razlan for RM1 is to meet the mandatory condition imposed by the Ministry of Investment, Trade and Industry (Miti) for Bumiputera equity.
“The absence of this permit poses significant challenges to EPMB's e-bike business, leading to a potential risk of breaching our exclusive distribution agreement with our principal partner, Sharkgulf Technologies Group Ltd,” said EPMB in a stock exchange filing on Friday.
By divesting the 70% stake to Razlan, EPMB said it would facilitate EP Blueshark in maintaining its operations, thereby addressing its compliance needs.
“In order to align with Miti's requirements, the board is of the opinion that the sale of shares represents the optimal choice. This strategic move is seen as having the potential to reinforce the commitment of the group CEO to the organisation and its long-term strategic objectives in the EV venture,” the group said.
Shares in EPMB closed 1.5 sen or 1.8% lower at 81 sen on Friday, giving it a market capitalisation of RM178.43 million.