Zeekr, Xpeng and MG are among the Chinese carmakers starting local assembly of EVs in Malaysia to continue to enjoy tax-free incentives, now reserved for CKD EVs, says the Ministry of Investment, Trade and Industry (MITI). This follows the expiration of blanket tax-free incentives for CBU imported EVs at the end of 2025.
The CKD products of the Chinese OEMs will continue to enjoy full tax exemption that applies to locally assembled EVs until December 31, 2027.
The ministry was replying to a question from senator Datuk Mustafa Musa, who asked about the investment of Chinese EV companies and the new floor price for CBU EVs, which is now RM250,000, up from the previous RM100,000.
On that, MITI said that the floor price change ‘to the original RM250,000 structure’ was appropriate to ensure a clearer transition from CBU imports to local assembly. It’s also done to protect investments made by national companies and local vendors.
“In addition, the domestic EV ecosystem will continue to grow sustainably, and high-skilled job opportunities in the country can be created and preserved,” MITI added.
We’ve reported on the CKD plans of the three brands mentioned by MITI, so here’s a recap. Two days ago, we were in Melaka for the line-off ceremony of the CKD MG S5 EV, which makes the SAIC Motor brand the first off the blocks. The S5 EV rolls off the line at EPMB’s Pegoh, Melaka plant, which will also assemble Xpeng’s G6, X9 and X9 PowerX REEV models. Production is scheduled to start at the end of this month.
Zeekr’s CKD work will not happen at this burgeoning ‘Chinese CKD hub’ as the premium brand is under Geely, which is a main mover of the Automotive Hi-Tech Valley (AHTV) in Tanjong Malim, anchored by Proton. Malaysia will be the first country outside of China to assemble Zeekr vehicles in a global expansion plan, and the first model is the 7X SUV. Click on the links for more details.
We understand the logic behind the RM250k floor price, but it shuts an interesting window in the Malaysian automotive industry where EVs in all shapes and sizes came in tax-free.
It also means that EVs that are unlikely candidates for CKD (due to low volume), such as the Honda Super-One pictured above, are no-gos if they aren’t expensive cars to begin with. While the Super-One is a cool and fun-to-drive EV, no one would pay RM250k for a tiny box. We understand that Honda Malaysia had plans for the Japan-made EV, and it would’ve been a nice toy for half that price, but alas.
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MITi is mangkuk ministry….how do u expect ev manufacturer to plan long term when the incentive only up till 2027. They think building a car factory is pasar malam. No wonder our neighbour like Thailand and indon has better policies. Seriously we need more competent and qualified people in our govt.
I am sorry, but I think this is ridiculous.
We need to reduce our dependency on cheap oil.
I think, we need more EV companies to invest here by CKDing their cars. But the RM 250k floor price will not attract the car companies to do the CKD investment here in Malaysia. It seems the government officers at MITI made a wrong decision on this one. Sorry MITI, I do not agree with your decision this time around.
For the CKD EV/PHEV/HEV cars, just charge 6% sst on top of the car final price. Remove all other duties on EV/PHEV/HEV car. As long as the EV/PHEV/HEV car is safe(ANCAP) and realiable, even if the car price is rm50k, let it come here as a CKD model, (more investment and more job creation).
Look at the recent yus/yeisrael attack on eran. See how fast the price of oil increase. Based on google gemini answer, Malaysia has been NET IMPORTING oil since 2014. So the increase in the oil price not helping our country like it used to be.
MITI officers need to think big, we can no longer rely on oil as we are no longer NET EXPORTING country. The higher the price of oil, the higher will be subsidizing cost bear by the government.
I’m not yet an EV owner, but looking at the current situation, EV/PHEV/HEV is the best alternative over a purely ICE vehicle.
Is the 250k floor price before or after manufacturer discounts?!
Agenda Crony di angkat.
Rakyat ditindas.
Middle finger to MITI.
The tax exempted Byd atto 3 is more much expensive than the current non tax exempted atto 3!!! The government and car dealer are cooperated to SCAM Malaysians