Tan Chong and SAIC Partner to Localise EV Battery Assembly in Malaysia

Tan Chong Motor Group and SAIC-GM-Wuling have entered into a strategic cooperation agreement to localise electric vehicle battery assembly within Malaysia. This partnership is set to launch under the TQ brand, marking a significant step in shifting the nation’s EV infrastructure from import-reliant assembly to integrated local manufacturing.

The core of this collaboration focuses on developing a robust, localised supply chain ecosystem. According to the original publisher, the initiative will begin with the CKD (Completely Knocked Down) assembly of EV batteries. This process serves as the foundation for a broader strategy to eventually expand production capabilities within the country, ensuring that critical components for electric vehicles are manufactured domestically rather than being sourced entirely from overseas.

While the timeline for full-scale production remains fluid, the agreement establishes a structured roadmap for technological integration. By bringing battery assembly to Malaysian shores, both Tan Chong and SAIC-GM-Wuling are positioning themselves to leverage Malaysia’s growing interest in green mobility. The transition to TQ-branded battery production implies a long-term commitment to infrastructure development rather than simple vehicle distribution.

For the Malaysian consumer and driver, this move suggests a potential shift in the total cost of ownership for future EV models. Localising battery production typically reduces logistical costs and import-related overheads, which, if passed down the value chain, could lead to more competitive pricing for electric vehicles in the local market. As the gap between subsidised petrol prices—such as the RM1.99 RON95 rate under BUDI95—and the cost of electric vehicle charging remains a point of contention for potential buyers, lower entry prices for EVs could be a decisive factor in consumer adoption.

The development also signals potential growth for the local manufacturing workforce. With an unemployment rate of 3.0 percent as of July 2026, the establishment of a specialised battery assembly line may offer high-value technical employment opportunities. For SMEs in the automotive support sector, the need for a localised supply chain could lead to new contracts for components, logistics, and technical maintenance services, effectively integrating local firms into the global EV supply chain.

This partnership arrives at a time of robust economic performance, with Malaysia recording a 6.0 percent year-on-year real GDP growth in the latest quarter. The move aligns with wider national efforts to transition away from fossil fuel dependence, particularly as the government navigates the complexities of fuel subsidy reforms, including the current unsubsidised petrol price of RM4.52 and the fixed diesel price of RM5.27. By anchoring the battery production process locally, Malaysia is positioning itself to be more than just a consumer market in the regional EV race.

Looking forward, industry observers will be watching to see how this localisation affects the wider automotive landscape in Malaysia. Previous efforts in the EV space have often been restricted to vehicle assembly, but the shift toward component-level manufacturing suggests that the government’s push for a domestic EV ecosystem is gaining momentum. The integration of TQ-branded batteries into the local market will likely serve as a litmus test for how quickly domestic production can scale to meet the needs of an increasingly cost-conscious public.

Despite the announcement, several key details remain unconfirmed. The specific investment figures, the projected annual production capacity of the battery plant, and the official start date for the first locally assembled TQ battery remain undisclosed. It is also not yet confirmed which specific vehicle models will be the first to feature these locally assembled battery packs.