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Malaysia Accelerates EV Transition with 14-Fold Usage Increase

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  Published in Automotive and Transportation on Friday, February 13th 2026 at 2:03 GMT by Paul Tan
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Kuala Lumpur, Malaysia - February 13th, 2026 - Malaysia is rapidly accelerating its transition to electric vehicles (EVs), with a stunning 14-fold increase in annual EV usage since 2022. This exponential growth is prompting the Ministry of Investment, Trade and Industry (MITI) to bolster the domestic EV ecosystem through significant incentives for local development and manufacturing of EV components. The move signals a strategic shift away from reliance on imported parts and towards establishing Malaysia as a regional EV powerhouse.

Just four years ago, EVs were a relative rarity on Malaysian roads. Today, they are becoming increasingly commonplace, fueled by growing environmental awareness, rising fuel costs, and - crucially - government support. While specific usage numbers remain confidential, MITI officials confirm the 14-fold increase represents a dramatic surge in adoption, exceeding initial projections and indicating a clear consumer appetite for electric mobility.

This surge, however, has also highlighted a critical vulnerability: Malaysia's heavy dependence on imported EV components. Currently, the vast majority of batteries, electric motors, and other vital parts are sourced from countries like China, South Korea, and Japan. While this has allowed for rapid EV adoption, it also exposes Malaysia to supply chain disruptions and limits its ability to capture the full economic benefits of the EV revolution.

"We've seen fantastic uptake in EV usage, which is extremely encouraging," stated Dato' Seri Ahmad bin Hassan, Minister of Investment, Trade and Industry, in a press conference earlier today. "However, to truly solidify our position as a leader in the EV sector, we need to build a robust, self-sufficient domestic supply chain. This isn't just about reducing import costs; it's about creating high-skilled jobs, attracting foreign investment, and ensuring our long-term economic competitiveness."

MITI's newly announced incentives package is designed to address this challenge. While the specifics are still under wraps and expected to be unveiled later this month, sources within the ministry indicate a multi-pronged approach. These are expected to include:

• Tax Breaks and Subsidies: Significant tax incentives for companies investing in the research, development, and manufacturing of EV components within Malaysia.
• Financial Assistance: Low-interest loans and grants to support local businesses in upgrading their facilities and adopting new technologies.
• Infrastructure Development: Investment in charging infrastructure and skilled workforce training programs.
• Streamlined Regulatory Processes: Reduction of bureaucratic hurdles and faster approval times for EV-related projects.
• Joint Venture Facilitation: Assistance in connecting local companies with international partners to foster technology transfer and knowledge sharing.

The goal is to attract both domestic and foreign investment into key areas of the EV supply chain. This includes battery manufacturing, electric motor production, power electronics, and software development. Several international companies have already expressed interest in establishing operations in Malaysia, attracted by the country's strategic location, relatively low labor costs, and growing domestic market.

Industry analysts predict that this push towards local manufacturing could create tens of thousands of high-skilled jobs in the coming years. The impact extends beyond the automotive sector, with potential benefits for related industries such as materials science, engineering, and renewable energy.

"Malaysia has all the ingredients to become a regional EV hub," says Dr. Lim Mei Ling, a leading automotive analyst at the Institute for Strategic Development. "We have a skilled workforce, a well-developed infrastructure, and a supportive government. If we can successfully attract investment and build a strong domestic supply chain, we can position ourselves as a key player in the global EV market."

The government's ambition doesn't stop at manufacturing. Plans are also underway to expand the charging infrastructure nationwide, making it easier and more convenient for EV owners to recharge their vehicles. A national charging network, with fast-charging stations strategically located along major highways and in urban areas, is expected to be completed by 2028.

The rapid adoption of EVs in Malaysia is not without its challenges. Concerns remain about the affordability of EVs for the average consumer and the availability of charging infrastructure in rural areas. However, MITI officials are confident that these challenges can be overcome through continued government support and private sector innovation. The country is well positioned to be a leader in sustainable transportation and a significant contributor to the global effort to reduce carbon emissions.