SHAH ALAM: Engineering solutions provider and research and development (R&D) firm, Sync R&D Sdn Bhd, is currently on the lookout for investors to fund the next phase of its plans for the Elektrik Bas Inovasi Malaysia (Ebim) project, which will require between RM50 million and RM100 million.
Chief executive officer Azlan Merican said Sync R&D had so far invested RM30 million in the project since its commencement in 2011, with the company completing its first Ebim prototype back in October 2015.
Despite its success with the first prototype, the company has faced some difficulty in finding investors to back the project. Azlan candidly said that the company had to “beg and borrow” in order to get the initial funding to kick-start the project.
“Nobody believes in R&D in Malaysia,” he told The Edge Financial Daily. “Mida (Malaysian Investment Development Authority) helped us out by giving us a matching grant, but we had to spend RM25 million to get the RM10 million grant and that was where the begging and borrowing came in.”
Azlan said the company will be looking for investors to raise up to RM100 million for the next phase, after it secures the safety and quality certification for Ebim.
“For the next commercialisation phase, we are looking for investors or venture capitalists from the government to invest in us going forward.
“We will need approximately RM50 million to RM100 million for the infrastructure costs, to build up the facilities and to produce the components. If there is a bus assembler that is willing to work with us, then we would not need such a huge space for the assembly.
“Our business model is quite flexible. We are open to listening to those who are interested in teaming up with us, moving forward, to get our product out there,” Azlan said.
Sync R&D is currently working on the second prototype unit of Ebim, which is expected to be completed by October. The prototype will then undergo testing and certification by TUV Rheinland Group, an international body that provides safety and quality certification for transportation.
If successful, Azlan said the bus would be the first electric bus to receive TUV’s certification internationally. After securing the certification, he said the company will start off with up to five sample units.
“It is a new product, so we have to convince the operators that the product is good and that it actually works. After that, the orders will come in. We are looking at producing an initial 30 units next year, and then ramping it up to between 100 and 150 units per year for the local market,” he said.
Sync R&D has its vision set on the foreign market as well, especially in emerging economies.
“I am keen on India, Indonesia, Thailand — countries around the Asean region, the growing market. India actually approached us two years ago, but we weren’t ready yet at that point,” he said, adding that India orders about 1,000 buses per year.
According to Azlan, there is big potential in the overseas market, as currently only the China-based manufacturers are producing electric buses commercially. These buses are the ones that are being used for the Bus Rapid Transit (BRT) line in Sunway.
He pointed out that China-made buses are relatively pricey, costing RM1.5 million to RM1.6 million.
“We are planning to sell our buses at the range of between RM1.2 million and RM1.5 million. We are still in the R&D stage, so we have not finalised costs. At the moment costs are high, as 70% of the components are electrical and electronics. Electrical and electronics are a volume game.
“Once we have the volume of orders, the parts will be cheaper,” he said.