Malaysia's EV Market on the Rise

Recent reports from Maybank Investment Bank indicate a pivotal shift in Malaysia's electric vehicle (EV) market by 2025. With incentives for completely built-up EVs, including duty exemptions and import restrictions for lower-priced models set to expire, mass premium EV makers are expected to localize assembly to maintain competitive pricing.

An electric car charging. Illustration photo by Pexels

EV Adoption and Market Projections

Forecasts suggest that EV adoption in Malaysia will reach 3% of the total industry volume (TIV) by 2025, with hybrid electric vehicles (HEVs) accounting for 5%. This projection is based on Maybank's TIV estimate of 750,000 units for the year. The Malaysian Industrial Development Finance Berhad (MIDF) Research also emphasizes the government's focus on positioning Malaysia as a hub for affordable EV production.

Challenges and Opportunities Ahead

Despite the optimistic outlook, challenges remain. The removal of fuel subsidies in mid-2025 and the acceleration of charging infrastructure development could be key inflection points for EV adoption. CIMB Securities notes that as competition intensifies, higher adoption of battery electric vehicles (BEVs) and domestic assembly will take precedence. Malaysian automakers are stepping up, with Proton unveiling its first electric SUV and Perodua planning to launch a B-segment hatchback EV in late 2025.

Infrastructure and Future Prospects

Maybank highlights the need for a significant increase in public charging infrastructure, with Malaysia aiming for 10,000 EV chargers by 2025. Despite the growth potential in the EV segment, traditional automotive sectors may face challenges, with analysts anticipating a decline in Malaysia's automotive TIV in 2025. However, opportunities for local automakers to expand into export markets and strengthen brand equity are on the horizon as domestic assembly capabilities and the skilled labor force improve.