DRB-Hicom, Geely ink HOA for Automotive High-Tech Valley development in Tanjung Malim
01 Apr 2023
DRB-Hicom Bhd and its automotive partner, China’s Zhejiang Geely Holding Group (Geely), have signed a heads of agreement (HOA) to reinforce the next phase of collaboration between them for the development of the Automotive High-Tech Valley (AHTV) in Tanjong Malim as Malaysia’s next-generation vehicle hub.
The AHTV will cover an extensive automotive and mobility solutions value chain, from a fully-fledged high technology global research and development centre to a manufacturing cluster and supporting services and associated ecosystem, according to a statement from DRB-Hicom.
“The focus of the HOA is the development of an integrated automotive city that will give birth to a hub for a new energy vehicle (NEV) industry. AHTV will occupy an area of approximately 1,000 acres and will be expanded accordingly to cater for future needs,” said DRB-Hicom.
The parties have been in talks for the development of the vehicle hub after a signing memorandum of understanding (MOU) to do so in April 2022. The MOU would have expired after six months if no definitive agreement was inked. DRB-Hicom updated via bourse filings in October 2022 and then January 2023 that they were in talks to extend the duration of the MOUs.
The HOA was signed by DRB-Hicom group managing director Datuk Seri Syed FAisal Albar and Geely’s chief executive officer Daniel Li Donghui at the Malaysia-China Business Forum that that was held on Saturday (April 1), in conjunction with Prime Minister Datuk Seri Anwar Ibrahim’s official four-day visit to China that started on March 29.
Anwar, who witnessed the exchange of documents between the parties, were joined by Geely founder and chairman Eric Li, and DRB-Hicom chairman Tan Sri Wan Zulkiflee Wan Ariffin.
“Over the next 10 years, AHTV is expected to attract some RM32 billion worth of investments, including by national car company Proton (Holdings Bhd). AHTV will also receive direct and indirect benefits from Proton’s plan to fully relocate its manufacturing facilities to Tanjong Malim by 2026. Proton currently produces five models in AHTV and another two models in Shah Alam, Selangor,” DRB-Hicom said. Geely took up a 49.9% stake in DRB-Hicom’s Proton in 2017.
“AHTV will also include a research-based university to nurture new talents and development in areas of new and emerging technologies for the industry and the automotive sector in general. It will also house an R&D centre that will provide carmakers with a tropicalised setting to test their vehicles,” DRB-Hicom added.
It also described Geely’s role in the development of AHTV as apt, given the global trend shifting towards NEV — neighbourhood electric vehicles — and the Chinese carmaker’s wide experience in the sector.
Source: The Edge Markets