Malaysia Implements New Regulations on Electric Vehicle Imports

The Malaysian government will implement new regulations for completely built-up (CBU) electric vehicle imports starting 1 July 2026. This regulation alters the minimum requirements for electric vehicles entering the market in the neighbouring country. Citing Paultan, the Ministry of Investment, Trade, and Industry (MITI) stipulates that all CBU electric vehicles must meet two main conditions: a minimum cost, insurance, and freight (CIF) value of 200,000 RM, approximately Rp 760 million, and a minimum motor power of 180 kW. Although it may seem more lenient due to the lowered power threshold, the change from a minimum price threshold to CIF value is expected to make imported electric vehicle prices even more expensive. This is because the CIF value represents the vehicle’s price upon arrival at the port before taxes, duties, import tariffs, and distributor and dealer margins. With the addition of import duties, excise taxes, sales taxes, up to distribution margins, the price of CBU electric vehicles in Malaysia is predicted to reach 300,000 RM, or about Rp 1.1 billion, for certain models. In fact, for electric vehicles imported from Europe or South Korea, import costs are said to be higher than products from China. MITI states that the new regulation has been socialised to holders of approved permit (AP) franchises on 30 April 2026. Previously, Malaysia provided exemptions from import duties and excise taxes for imported electric vehicles since 2022, specifically for models priced above 100,000 Malaysian ringgit. However, after the incentives end, imported electric vehicles will again be subject to import duties, excise taxes, and a 10 per cent sales and service tax. This new regulation is believed to be the Malaysian government’s step to encourage local assembly or completely knocked down (CKD). With this new regulation, brands that do not yet have local production facilities are expected to struggle to keep selling prices competitive. Several popular models are said to be at risk of being affected because they do not meet the minimum power requirement of 180 kW or will experience significant price increases.