MITI flip flops once again with a new CBU EV policy.
The Malaysian electric vehicle (EV) landscape is bracing for a massive shift according to a video report by Paultan.org. According to the report, the Ministry of Investment, Trade and Industry (MITI) suggests that the era of affordable imported electric cars may be coming to an abrupt end. Starting July 1st, 2026, new regulatory changes are expected to push the price of most Completely Built-Up (CBU) EVs to a minimum of RM300,000. This will be at least the third time MITI has flip-flopped on their CBU EV policy this year.
The Shift from Selling Price to CIF Value
During the tax-free period for CBU EVs, Malaysia maintained a minimum floor price of RM100,000 for imported EVs, which was reasonable to prevent the market from being flooded with low-quality micro-cars. Now that the tax-free period is over, MITI is still trying to figure out a formula that can balance the interest of legacy CKD players and the need to transition to electric mobility.
The latest update shows that the government is moving toward a minimum CIF (Cost, Insurance, and Freight) value of RM200,000. Once you factor in the 25% import tax, along with distributor and dealer margins, the final retail price in showrooms will likely start at RM300,000. This effectively doubles the entry barrier for imported EVs.
It isn’t just about the price; it’s about performance. MITI has introduced a minimum power output requirement of 180 kW (245 PS) for imported EVs. It’s unknown what’s the goal of this minimum power output requirement.
The impact of this policy is widespread, affecting both new and established players:
- Most CBU EVs: mass market CBU EV models like the BYD Atto 3 and Ora Good Cat may not get replacement models as they don’t reach the minimum power requirement
- Tesla: While Tesla enjoys a unique status in Malaysia, it remains to be seen if the Model 3 and Model Y will be subject to these new price floors, which could push their costs well above the RM300k mark.
- Proton: These regulations appear designed to provide a “protectionist buffer” for this local brand without factoring the fact that it’s 49.9% owner is Geely and has an interest in keeping BYD and other Chinese rivals at bay.
What’s the Point?
While the ultimate goal of this policy is to force global manufacturers to invest in Malaysia. There are still some quetions around this policy from MITI. First, why this specific price point and why this specific minimum power output? Why wasn’t this regulation ironed out BEFORE 2026 so that non-protected players and potential investors are better able to strategize. How does this align with the government’s goals of 80% EV adoption by 2050. We’re also not convinced that limiting affordable EV options is beneficial for competition and consumers in general. Say what you want about the 2022-2025 period, but it’s undeniable that overall TIV increased to record highs while legacy players were forced to ‘trim the fat’ and deliver more value. This new policy looks like a return to the dark ages, at least for the Malaysian consumer and new potential investors.
