Malaysia has announced new measures aimed at reducing reliance on fully imported electric vehicles as the government shifts its focus toward promoting localisation and domestic manufacturing.
The country’s Ministry of Investment, Trade and Industry said new import conditions for completely built-up (CBU) electric vehicles will take effect from July 1, 2026.
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Under the revised policy, franchise approved permit holders will only be allowed to import fully assembled electric vehicles with a minimum Cost, Insurance and Freight (CIF) value of 200,000 ringgit ($47,000) and a powertrain output of at least 180 kilowatts.
The ministry said companies holding franchise approved permits were informed of the changes on April 30.
Malaysia previously introduced incentives to accelerate early electric vehicle adoption by lowering import barriers for fully imported EVs.
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In 2021, the government announced full exemptions from import and excise duties for CBU electric vehicles priced above 100,000 ringgit between 2022 and 2023. Those incentives were later extended through the end of 2025.
Beginning in January 2026, Malaysia reinstated import and excise duties on CBU electric vehicles and introduced a minimum selling price threshold of 250,000 ringgit.
The newly announced rules replace the earlier retail-price-based system with a CIF-based valuation method.
Industry observers expect the change to significantly raise retail prices for imported electric vehicles once taxes, duties and dealer margins are included.
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Under the new framework, imported EVs could retail for 300,000 ringgit or more, potentially limiting access to lower-priced imported models. The impact is expected to vary depending on the country of origin.
As a member of the Association of Southeast Asian Nations, Malaysia applies a 5% import duty on electric vehicles imported from China under existing free trade agreements.
By contrast, electric vehicles imported from Europe and South Korea face import duties of 30%. The government also slightly relaxed its minimum power requirement for imported EVs.
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The current regulation requires fully imported electric vehicles to deliver at least 200 kW of output, while the revised framework lowers that threshold to 180 kW.