2025 EV Bull Run Meets 2026 Policy Vacuum

Two days into 2026, and one thing is immediately evident: CBU EV prices across brands in Malaysia have not moved. Online sites still display 2025 pricing, order books remain open, and consumers are not yet feeling the sting of the excise duty exemption ending on paper.

But this is not stability. It is inertia.

EV prices still remain same moving in 2026

The reason is straightforward and widely understood within the industry. Most, if not all, EV brands rushed to import and declare substantial volumes of CBU inventory before the Dec 28, 2025 cut-off, parking vehicles in customs warehouses and bonded zones to qualify under the old tax regime. 

What we are seeing now is not policy continuity, but the last afterglow of a loophole-driven inventory strategy. This temporary calm masks a more fundamental problem – the absence of a soft landing mechanism promised.

Ex-MITI minister Tengku Datuk Seri Zafrul Abdul Aziz had previously confirmed in Oct 2025 that discussions with the Ministry of Finance are ongoing, but also that no concrete proposals have been tabled. That admission alone speaks volumes. 

What the government however needs to understand is that the auto industry does not function on instant moves and overnight decisions. Product planning, production allocation, shipping schedules, homologation, dealer inventory and financing structures all operate on timelines measured in quarters, not weeks.

By failing to offer clarity well before the end of 2025, policymakers have effectively forced brands into a defensive posture. Today, distributors are not planning fresh CBU replenishment. They are simply clearing what is already in hand. Once those stocks run dry, there is no visibility on what replaces them, at what price, or under what duty structure.

The immediate consequence is a quiet freeze. New EV model introductions are likely to slow down, not because brands lack products, but because committing to CBU imports without clarity on duties is commercially reckless. The safer pivot, at least in the short term, will be towards hybrids and PHEVs, where tax exposure is better understood and demand risk is lower.

2026 at the surface looks like the year hybrids and PHEV take the forefront

Yes, many brands have promised CKD EVs in 2026. But realism matters. Setting up assembly lines, validating suppliers, training labour and aligning quality systems takes time. Outside of Proton’s e.MAS 7, Perodua’s QV-E and Chery’s locally assembled E5, most CKD EVs will only materialise in late Q2 or early Q3 2026 at best. Even Proton’s e.MAS 5 remains a CBU import from China today.

Between now and then, the market sits in limbo.

This is where the cost of uncertainty becomes most apparent. 2025 was shaping up to be a genuine EV bull run, driven by price accessibility, broader model choice and growing consumer confidence. 

However, by withholding a clear transition framework, MITI has effectively pressed pause on that momentum.

The irony is that this pause comes precisely when Malaysia’s EV adoption curve needed continuity, not disruption. Charger rollout is already lagging, CPOs are scaling back amid low utilisation, and consumer sentiment remains price-sensitive. A sudden policy vacuum only amplifies hesitation across the ecosystem.

Which brings us to the uncomfortable question. How does Malaysia realistically hit its electrification targets – 20% by 2030, 50% by 2040 and 80% by 2050 – if the bridge between incentives and localisation is left undefined?

Accelerating local assembly is a valid industrial objective. But without a measured transition, the risk is that affordability collapses before localisation matures. A soft landing was never about extending incentives indefinitely; it was about ensuring the runway was long enough for the aircraft to actually take off.

As of today, that runway looks worryingly short, don’t you think?