Rising Competition, EV Policy Shift Slow Malaysian Car Market - RHB Investment

More Malaysians are putting off buying cars, hoping for bigger discounts as competition heats up among foreign carmakers especially with more Chinese brands entering the market, Berita Harian has reported.

According to RHB Investment Bank, this has started to slow overall car sales. Analyst Iftaar Hakim Rosli said the wave of new models and aggressive pricing is creating intense pressure, especially for non-national brands.

“This kind of price war is making the segment unstable,” he says, in the BH report. Even top players like Perodua and Toyota are seeing thinner backlogs. Perodua’s dropped to 90,000 units from 100,000 a year ago, while Toyota’s fell to 15,000 from 20,000.

“At the same time, loan approvals for car buyers have declined to 55% this year, compared to 58-63% in previous years pointing to tighter lending conditions,” the investment bank noted.

Meanwhile, uncertainty remains over future car prices. A planned update to excise duties for locally assembled vehicles has been delayed to January 2026. Without another extension, prices could rise by 10-30%, though the government has hinted the hike may not be that steep.



Electric vehicles, which have benefited from tax exemptions, may soon lose that edge. The current exemptions for fully imported EVs are set to end this year, as the government shifts focus to local assembly, which will continue to enjoy tax breaks until 2027.

“EV demand is expected to grow, but high prices and limited charging stations are still major hurdles to wider adoption,” it added. Source: BH.