Malaysian Auto Sales Projected To Surge In 2025

A range of exciting newly launched models will continue to drive auto sales in Malaysia this year.

According to BIMB Securities, the local auto industry will continue to benefit from strong domestic demand fuelled by the 2025 adoption of higher minimum salaries and the government servant salary increase, which is anticipated to further encourage car purchases.

Based on historical trends that indicate TIV has historically increased in response to civil servant compensation increases, the research firm maintains its projection for the sector's total industry volume (TIV) at 810,000 units in 2025. It noted, for example, that TIV increased by 7% year-over-year (y-o-y) in 2008 and 5% y-o-y in 2012 as a result of increases in civil servant salaries.

For the record, the local auto industry performed steadily in the first 11 months of 2024, with TIV reaching 731,534 units, indicating a little 1.4% year-over-year increase over the 721,392 units in the same period in 2023.

Regarding EVs, BIMB Securities emphasised that the rationalisation of the RON95 subsidy could encourage a move towards EVs and fuel-efficient vehicles. The company anticipates that high-income individuals from T15 households may use this as an opportunity to switch from conventional Internal Combustion Engine (ICE) vehicles to EVs, as rising fuel prices make EVs a more appealing option due to their lower long-term operating costs.

“This shift is further supported by government incentives for EVs, such as tax exemptions and rebates, and the increasing emphasis on environmental sustainability”, it added.