BYD appears to be reconsidering its grand plans for a local assembly (CKD) facility in Tanjong Malim, which is orginally planned to commence operations by 2026. According to reports from The Edge, the Chinese EV giant is struggling to swallow a rather restrictive 80:20 export quota proposed by the Malaysian government.
Under these terms, BYD would be required to ship the vast majority of its locally assembled cars overseas, leaving a mere 20% for the local market. There is a catch, however. Any of those locally assembled cars sold in Malaysia must carry a price tag north of RM200,000.
In a brief phone conversation with The Edge, Minister of Investment, Trade and Industry Datuk Seri Johari Abdul Ghani explained that these specific terms were established to ensure the survival of the domestic automotive industry.
According to Johari, the 80% export requirement and the RM200,000 price floor for the local market are necessary policy measures. These conditions aim to safeguard a broader local automotive ecosystem that currently provides employment to some 700,000 people.
The Minister further noted that national brands Proton and Perodua already maintain a 50% local content threshold in their vehicles. This is why the Proton eMAS 5 (stylised as e.MAS 5) and the Perodua QV-E can be priced under the RM100,000 mark.
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Foreign players face an even steeper climb if they choose to remain as importers. New government regulations mandate that fully imported (CBU) EVs must be priced above RM250,000 and possess a minimum power output of 272 hp (200 kW). This effectively bars entry-level models from Malaysian shores, especially since most budget EV models fall significantly short of such high power outputs, let alone the RM250k price tag.
Even for those who choose to assemble locally, the RM200,000 price floor remains, effectively cordoning off the affordable segment as a protected stronghold for national brands.
It remains to be seen how this policy will affect the rest of the local automotive industry. MG Motor has already commenced local assembly at its Melaka facility and rolled out the first CKD units of the MG S5 EV this month. Others are following a similar path. Both XPeng and Zeekr have established plans to begin local assembly in 2026, with XPeng in talks with EPMB to use their facility in Melaka for CKD operations.
While premium marques like Zeekr and XPeng may comfortably clear the RM200,000 price floor with their line-ups, the 80% export mandate remains a significant barrier. Like BYD, these brands may find little point in establishing local facilities if they are forced to treat Malaysia primarily as an export hub rather than a priority market.
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