Looks like this is how you sell a new car today, using rebates, high overtrade and discounts at new vehicle launches
In 2025 and coming into 2026, selling a new car revolves heavily around immediate (at launch), tangible value, where a cash rebate and a price discount strategy acts as the primary, indispensable sales tool.
This trend has already pushed used car values DOWN in 2025 and for 2026 it will get even worse!
With rising new vehicle launches and very very very close rival models coming from new car manufacturers, buyers are hyper-focused on reducing the “out-the-door” selling price, making cash incentives the most effective sales closing tool (NOT the quality, features and drive dynamics).
Since the arrival of shiny new high technology Chinese automotive brands, the launch of every new model has had ‘high cash rebates’ for the early bird customers. However, as time passes, even the ‘late birds’ get the discounts.
Then as the months progress, a rival shiny new direct competitor model is launched at a slightly lower price and this prompts the management of the early car launch model to almost immediately offer a boldly advertised discount on high frequency digital boards and media channels.
This will in turn push the just launched auto model to get added discounts at showroom level and so the ‘price war’ continues.
The winners are clear, the Malaysian car buying population …… in the initial months ONLY. Why? Well, after a year or so this price war pushes used car values down (as we are seeing in the late part of 2025) and this is worrying as the months progress along. Let us explain further.
As used car values drop ….. car owners looking to upgrade to a shiny NEW car will NOT get the used value expected for their old car. If their old car is still having a loan, then they might not even get any cash back.
This is when an old car owner (3-5 years for example) might say, better to keep their car and wait and so new car sales might start reducing in the near future.
Here is how modern rebates and discounts are driving new car sales today
1.Manufacturer Rebates (Cash Back) These are direct deductions from the MSRP, which also reduces the total vehicle loan amount. Advertised as “Rebate” or “Early Bird Discount,” these are frequently used at new car launches in the past year or so.
Some new automotive manufacturers (Chinese new energy brands) have combined multiple offers. For example, a customer might receive a manufacturer price rebate plus battery charge credit and home wall box charging system with installation.
2. Strategic “Cash-for-Clunkers” and Trade-In Rebates (see image above)
Government/Manufacturer Matching Grants: As seen in 2026 here in Malaysia, the government is offering up to RM4,000 for scrapping cars over 20 years old, which is matched by national car brand, Proton which creates an attractive, immediate discount for the buyer. There are some offering extra, guaranteed value (example, up to RM1,500) over the market rate for a trade-in, provided the customer buys a new or pre-owned car, has been a dominant strategy in 2025.
Question? Can this continue and for how long more in Malaysia?
