MITI Finalising New Customised Incentive Mechanism to Drive EV Growth

The Ministry of Investment, Trade and Industry (MITI) is close to finalising a new incentive framework to drive Malaysia’s automotive sector.

Known as the New Customised Incentive Mechanism (NCM), the scheme will replace the current customised incentives with a structure that is clearer, fairer and more attractive to investors, while strengthening Malaysia’s role in the regional market.

MITI Minister Tengku Datuk Seri Zafrul Abdul Aziz said the framework will provide carmakers and suppliers with greater policy certainty, backed by measures that support ecosystem growth and encourage long-term investment.

“These measures, alongside efforts to expand Malaysia’s EV charging network, will keep our policies aligned with global mobility trends and build the kind of ecosystem that boosts consumer confidence in electric vehicles,” he said at the launch of the iCaur 03 EV SUV last night.

The auto sector has been riding strong momentum, with sales reaching a record 816,747 units in 2024 - the first time it crossed the 800,000 mark. While 2025 is expected to stabilise, the Malaysian Automotive Association (MAA) projects a still-solid sales of 780,000 units this year.

Zafrul noted, however, that growth is not just about volume. The government also wants Malaysians to have access to vehicles with advanced drivetrains, strong safety features and modern technologies that deliver efficiency and reliability.

As part of Malaysia’s green mobility shift, MITI and the Malaysia Automotive Robotics and IoT Institute (MARii) are conducting a mid-term review of the National Automotive Policy 2020. The update will reflect global industry changes, focusing on reducing reliance on petrol, boosting component exports and ensuring Malaysia stays ahead of fast-moving mobility trends.

With Malaysia set to chair ASEAN in 2025, the country also aims to strengthen regional supply chains, expand cross-border EV infrastructure and promote joint R&D in next-generation technologies. “We want Malaysia to be a hub for innovation and production, serving not just the local market but the wider ASEAN and Asian region,” Zafrul said.

He added that foreign investors such as Chery are vital in accelerating Malaysia’s technological capabilities, and that the government remains committed to delivering stable policies and tangible results. “Investors need confidence not just in our direction, but also in our ability to execute,” he said.

The NCM is expected to become the backbone of Malaysia’s automotive incentive structure, replacing the older, less transparent system and signalling a shift towards stronger investor confidence.

Source: BernamaBiz