Tan Chong Motor Explores EV Battery Localization in Malaysia

Tan Chong Motor Explores EV Battery Localization in Malaysia

Tan Chong Motor Holdings Berhad is exploring EV battery localization in Malaysia through an agreement involving its indirect wholly owned subsidiary, TQ Manufacturing Sdn. Bhd. (TQM), and Chinese battery-pack supplier Saike REPT Power Battery System Co., Ltd. Announced on September 17, 2026, the 12-month memorandum of understanding (MOU) establishes a framework for the two companies to assess the feasibility of localizing battery packs and other identified electric vehicle components. The initiative specifically includes components for TQ Wuling vehicles and also considers potential supply opportunities for markets outside Malaysia.

12-Month MOU Covers Local Battery Manufacturing Feasibility

Under the MOU, TQM and Saike REPT Power Battery System Co., Ltd. will conduct a feasibility study focused on whether battery packs and other selected EV components can be localized in Malaysia. The assessment is intended to examine the practical potential for local production and supply, including applications for TQ Wuling vehicles. The companies will also evaluate whether components developed or localized through the initiative could eventually be supplied to other countries. No definitive production or supply commitment has been established at this stage, because any subsequent agreement will remain subject to the outcome of the feasibility study and agreement on applicable commercial and other terms.

Study Also Examines EV Battery Recycling and Second-Life Use

The scope of the collaboration extends beyond battery-pack localization to the treatment and continued use of batteries after their initial vehicle application. TQM and Saike REPT Power Battery System Co., Ltd. will assess opportunities involving the recycling of used EV batteries as well as potential second-life applications. These areas form part of the broader feasibility study established under the 12-month MOU. The inclusion of recycling and second-life use means the companies are evaluating multiple stages of the EV battery lifecycle rather than focusing solely on battery-pack manufacturing for new vehicles. The article does not specify particular recycling technologies, second-life applications, investment amounts, or production volumes.

Potential Supply Beyond Malaysia Remains Under Assessment

The collaboration also includes an assessment of potential supply to other countries, indicating that the parties will consider applications beyond the Malaysian market during the feasibility process. This aspect is relevant to the commercial scope of any future localization program because a viable supply model could potentially serve both domestic vehicle requirements and external markets. However, the MOU itself does not establish specific export destinations, quantities, pricing arrangements, or production targets. Those details would require further agreement between the parties. The immediate purpose of the arrangement is therefore to determine feasibility and commercial terms rather than to confirm a finalized regional battery manufacturing or supply operation.

Future Agreement Depends on Feasibility Study

The MOU does not itself create a definitive commitment to proceed with localized battery production or component supply. Any subsequent definitive agreement between TQM and Saike REPT Power Battery System Co., Ltd. will depend on the findings of the feasibility study and the parties reaching agreement on the relevant terms. This leaves the project's eventual scale, investment structure, manufacturing arrangements, supply obligations, and implementation timing undetermined. For Tan Chong Motor Holdings Berhad, the current development establishes an evaluation framework for potential EV component localization while preserving the need for further technical and commercial assessment before any binding next-stage arrangement is concluded.

Industry Impact & Outlook

The MOU could provide a framework for evaluating greater localization of EV battery packs and related components in Malaysia, while the recycling and second-life work could broaden the potential scope of the collaboration across the battery lifecycle. For TQM and Tan Chong Motor Holdings Berhad, the immediate significance lies in assessing technical and commercial feasibility rather than confirming a completed manufacturing program. Saike REPT Power Battery System Co., Ltd. also gains a defined framework for evaluating localized applications and potential supply beyond Malaysia. The next material developments will depend on the feasibility findings and whether the parties agree to proceed with a definitive agreement and specific terms.

Frequently Asked Questions

What does Tan Chong Motor’s EV battery MOU cover?
The MOU covers a 12-month feasibility study examining localized battery packs and other EV components in Malaysia. The study includes applications for TQ Wuling vehicles, potential supply to other countries, and the recycling and second-life use of used EV batteries. TQ Manufacturing Sdn. Bhd. is conducting the initiative with Saike REPT Power Battery System Co., Ltd. Any future definitive agreement will depend on the feasibility study's results and agreement on relevant terms. The MOU therefore establishes an evaluation framework rather than confirming a final production or supply commitment.