Annual EV usage in Malaysia has jumped 14-fold since 2022, incentives for local EV parts development – MITI

The investment, trade and industry ministry (MITI) has said that annual EV usage in Malaysia has jumped from 3,127 units in 2022 to 44,813 in 2025, Bernama reports.

The 14-fold increase was driven by the government’s import and excise duty exemption for fully-imported (CBU) EVs, MITI said in a written reply to the Dewan Rakyat published on the parliament website recently.

“In line with the National Automotive Policy 2020, which targets to make Malaysia a production and export hub for Next Generation Vehicles (NxGV), the government continues to encourage the local development of critical EV components, including batteries, electric motors and advanced driver assistance systems (ADAS) through tax incentive provisions to original equipment manufacturers (OEMs) that utilise them,” it said.

“The next phase is to encourage more OEMs to implement local EV assembly,” it added. CBU EVs were tax-free from Budget 2022 to December 31, 2025 – beginning this year, they’re subject to a 5-30% import duty (depending on origin country and if there any free trade agreements) + 10% excise duty + 10% sales tax (ST was there before).

Also, they must not be priced under RM250k and their combined power must not be less than 200 kW (272 PS). All these are to encourage local assembly (CKD).

Carmakers already producing EVs in Malaysia include Proton, Perodua, BMW, Volvo, Chery, Mercedes-Benz and TQ Wuling, while BYD, Zeekr, MG, Xpeng and Leapmotor are amongst those planning or working on doing so.