MAA: Increased xEV Adoption Charged Industry’s 2024 Sales

Following up on the Malaysian Automotive Association (MAA) 2024 vehicle sales report, which highlighted a record-breaking year, electrified vehicles (xEVs) have shown significant growth.

Based on the figures released by the association, xEVs captured a larger share of the total industry volume (TIV), thus underscoring their growing importance in the local automotive landscape.

Sales of xEVs, which covers battery electric vehicles (BEVs) and hybrid vehicles, reached 45,562 units in 2024. This represents a 19% increase from 2023’s 38,214 units.

BEVs alone saw a significant surge by 45% to 14,766 units. This, according to MAA, was driven largely by the government’s tax incentives and an influx of new models, particularly from Chinese manufacturers.

Meanwhile, hybrid vehicles continued to dominate the xEV category, with 30,796 units sold in 2024. Their appeal lies in their ease of adoption and suitability for consumers transitioning from traditional internal combustion engine (ICE) vehicles.

The strong performance of BEVs can be also attributed to the ongoing full exemptions on import and excise duties for fully imported (CBU) EVs. However, these incentives are set to expire by end of 2025, creating uncertainty about the market’s trajectory.

From which, MAA emphasised the importance of extending these incentives till 2030 to meet the government’s target of 20% EV adoption. Despite this progress, MAA also highlighted the limited availability of EV charging infrastructure, especially in less developed areas, citing that this could hinder widespread adoption and erode consumer confidence in EVs.

The government’s petrol subsidy rationalisation, meanwhile, is expected to drive EV adoption further, especially amongst higher-income T15 households affected by the policy. MAA anticipate sales of vehicles with large-capacity engines are likely to drop. However, this shift may not significantly impact TIV, as it does not represent the broader market.

Locally assembled (CKD) models play a critical role in making xEVs more accessible. Currently, the market relies heavily on imported models, which limits cost competitiveness. Adding to this challenge is the impending revision of the Open Market Value (OMV) excise duty calculation planned for Jan 2026.

Once implemented, the raised OMV could raise CKD vehicle prices between 10% to 30%. MAA is actively engaging with the government to address this issue and mitigate its impact, especially as the government encourages more brands, including NEV manufacturers, to introduce CKD offerings in Malaysia.

According to MAA, hybrid vehicles remain a crucial component of Malaysia’s electrification efforts. Their larger market share demonstrates their effectiveness in bridging the gap between ICE vehicles and fully-electric (BEV) options. MAA also advocates for a structured and sustainable hybrid incentive program to avoid the pitfalls of past hybrid initiatives, which ended in 2014 leading to hybrid sales stagnation.

Looking ahead, MAA also remains optimistic about the future of xEVs in Malaysia but underscores the importance of sustained government support and industry collaboration. The rising demand for BEVs and hybrids is a promising sign, but overcoming infrastructure and policy hurdles will be critical.

With collective effort, Malaysia can secure its position in the global EV ecosystem while achieving its electrification goals.