The government through the Ministry of Investment, Trade and Industry (MITI) has set two new conditions for the importation of electric vehicles (EVs) in Completely Built-Up (CBU) form starting July 1, 2026, namely the minimum Cost, Insurance and Freight (CIF) value of RM200,000 and the minimum motor power adjusted from 200kW to 180kW and above. This change was made after a special exemption period of four years ended on December 31, 2025, marking a policy shift to a more controlled structure in the entry of imported EVs.
Limits on the Entry of Affordable EV Models
From a consumer perspective, the setting of this price threshold limits the entry of affordable EV models into the local market. For example, models such as the BYD Dolphin and MG4 EV that are in the price range below RM200,000 can no longer be imported in CBU form. This has direct implications for consumers who previously relied on imported EV options at more competitive prices.
For the premium segment, high-priced and powerful EV models remain relevant in the import market. Among the models expected to continue entering the market include the Tesla Model Y Long Range, BMW i4 eDrive40 and Hyundai Ioniq 5 AWD, which meet both price and power requirements. For brands from China, only high-performance variants such as BYD Seal Performance have the potential to remain in the CBU import channel.
Opening up Investment Space for Industry & Domestic Chain
In the context of the shift to local assembly (CKD), several global brands have been early to build production plants in Malaysia to maintain price competitiveness and comply with policy changes. Among the standouts is BYD through the locally assembled BYD Atto 3 model, allowing it to remain in a more competitive price segment.
In the premium category, Mercedes-Benz assembles the Mercedes-Benz EQS 500 4MATIC model at its Pekan facility, while Volvo produces the Volvo XC40 Recharge in Shah Alam. BMW is also strengthening its CKD strategy through the BMW iX xDrive40 in Kulim. This development shows that local assembly is now the main approach to maintaining market access, especially as CBU import requirements become more stringent, while also opening up space for domestic industry and supply chain investment.
While the Malaysian market is still dominated by ICE cars, these new requirements are expected to slow the transition to EVs. At the same time, the market focus is shifting to premium segment imported EVs, while affordable models will rely on local assembly. This change will affect manufacturer strategies, pricing and consumer choices in the near term.
