INNOVATE

Waiting for Elon: When Will Asia Get the Tesla Model 3?

Beyond the initial cost of owning an electric vehicle, there’s also the infrastructure problem

Share on
BY Marishka M. Cabrera - 04 Aug 2017

tesla model 3

PHOTO CREDIT: Getty Images

In July, the automotive world was abuzz as Tesla CEO Elon Musk unveiled the first Model 3 cars out of the production line at an event in the automaker’s manufacturing plant in Fremont, California. The Tesla Model 3 represents the tech company’s foray into making an affordable electric car, with prices starting at $35,000 compared to the $85,500 Model X. It runs for 220 miles on a single charge and can go from 0-60 mph in less than 6 seconds.

For car enthusiasts in the region, however, what does the future hold for electric vehicles?

“I certainly would like to have a test drive on this mass market electric car by Tesla. From the first Tesla roadster, I have been intrigued by the vision of Elon Musk and his Tesla team to bring an electric car to the public roads,” says Bryan See Toh, co-founder and CEO of Singapore-based Park N Parcel. He adds that the affordable price point would “definitely appeal to the mass market” who were previously left out by Tesla’s pricier models. “I expect to see more adoption of Tesla on the road for the next decade,” he says.

“We think it’s a vehicle that has definite potential, and could be a turning point in [electric vehicle] production worldwide,” says a source from TopGear Philippines.

But as far as seeing Southeast Asians driving electric cars anytime soon, it seems unlikely. “We’re very far behind. Legislation to make EV {electric vehicle} entry easier is very weak, practically non-existent. And the market prefers sports cars given the same price option,” the source adds.

For Piyapong Muenprasertdee, co-founder and community director of Thai music streaming start-up Fungjai, availability, accessibility of charging stations, financial incentives, and government regulation are among the factors that would influence the speed of adoption of the Tesla Model 3 and all-electric cars in general. “And with more electric cars on the road, I would assume that more investments could be allocated to the research of renewable energy sources for electricity production,” he adds.

Around the region, efforts are being made to move towards the use of electric cars. Last year, a Malaysian government organization began installing electric car chargers nationwide in anticipation of future demand for electric vehicles. GreenTech Malaysia announced plans to set up 300 electric vehicle (EV) chargers by the end of the year, according to a report from Nikkei Asian Review. In Thailand, the Finance Ministry’s latest excise tax rebate seeks to bolster the production and use of electric cars in the country, according to an article in the Bangkok Post. Thailand is also moving towards adding electric vehicles to its regional supply chain and domestic market.

But Piyapong says that unless there is “some drastic measure or policy to get rid of petroleum-based vehicles,” most people would hold off on switching to electric cars due to high costs.

For Justin Hall, principal at venture capital firm Golden Gate Ventures, to see Southeast Asians driving electric cars is still a big ask.

“To be honest, I only see the Tesla Model 3 achieving any kind of traction in Singapore, and even then it would be minimal,” he says. After all, beyond the costs associated with owning a vehicle in Singapore—unless Tesla can negotiate some form of credit for their cars—there’s also the problem of the electrical public infrastructure required to charge and maintain these vehicles.

For See Toh, “Two factors are essential in order to see the mass adoption of electric vehicles in Singapore. Firstly, we require a pro-regulatory framework, for example carbon rebates on the all-electric vehicles regardless of electric energy consumption. Secondly, a more robust network of electric vehicles charging point is required.”

Then again, Hall explains, Singapore is relatively small and most car owners could ideally just charge their electric vehicles at home. But for the rest of Southeast Asia, he says, the logistical and economical constraints of buying, maintaining, and charging an electric vehicle can be trickier in emerging markets than it is in Singapore.

“Beyond that, many cities around the region already have horrendous traffic, and the car dealership industry is crowded with politically well-connected incumbents. Breaking into the region could potentially be more trouble than it’s worth,” Hall warns.