EV sales not speeding up

THE broad narrative today is that the sales of electric vehicles (EVs) in the country will see a strong rise due to the increase in non-subsidised petrol prices.

This is quite true in many markets where petrol prices for the masses have risen. A strong rise in EV sales has been apparent since 2025 in countries such as Singapore, Vietnam, Thailand and Indonesia. But not Malaysia.

The high EV expectations may be a misplaced assumption in Malaysia, where petrol is still subsidised for most – some 90% of the population.

The latest data from the Road Transport Department (JPJ) shows EV vehicle registrations totalling 5,633 last month, which is a year-on-year (y-o-y) growth of 46.7%.

The figure for March is the first full-month data available since the Iran war erupted on Feb 28.

It is notable that despite the steepest hikes in floated petrol prices in recent history, along with the unexpected onset of the war – EV registrations for March were still weaker than the 7,687 EVs seen in January 2026, the first quarter’s highest figure ever.

For March, the JPJ statistics available on data.gov.my shows 2,071 Proton e.Mas 5 and 952 Proton e.Mas 7 registered. These two models made up more than half of EVs that were registered last month.

This is an indication that most buyers will only be open to lower priced EVs. The e.Mas 5 is priced from RM56,800 for the base model, while most other offerings in the EV space are above the RM100,000 price point.

Also, Perodua’s QV-E, which is at the RM80,000 price point, only saw 11 registrations in March, likely because of the psychological barrier of its battery subscription service model.

Low-priced EVs are also widely available in Indonesia where petrol (RM2.38 per litre) and diesel (RM1.62 per litre) are subsidised, which explains why sales of EVs are rising quickly in the archipelago despite the availability of subsidised fuel.

Back home, the JPJ registration data for EVs – despite showing some gains in March – may also be misleading since it also includes cars that have been brought in by dealers to be placed in showrooms around the country.

There are also outstanding issues surrounding EVs, including sufficient availability of charging infrastructure in the country and the rather long charging times for long-distance drives. This causes range anxiety.

The general lack of maintenance culture is also contributing to this situation.

Some EV charging stations are inoperational while some EV bays are often used as parking bays, causing delays and distress to drivers.

Also, charging costs for EVs compared to petrol are only competitive when one owns or has access to home charging – which excludes those who live in high-rises, a dominant residential trend in most urban centres especially in the Klang Valley.

Apart from that, car dealers say the resale values of EVs are also a point of concern.

Marketing claims of the durability of EV batteries aside, it is an accepted reality that EVs will see most or if not all of its resale value dissipating, especially after the warranty period of the battery lapses – usually after eight to 10 years.

TA Research automotive analyst Angeline Chin says she is still quite cautious on car sales for this year and the next.

“The tensions in the Strait of Hormuz have pushed crude oil prices higher, and that’s starting to translate into higher fuel costs on the ground.

“For consumers, this means a higher cost of ownership, on top of already rising living expenses and the cut in RON95 subsidy rationalisation,” Chin tells StarBiz 7.

“At the same time, the market is slowly returning to normal after the post-pandemic surge, with most backlog orders already cleared, so we think total industry volume (TIV) could start to soften from the previous year,” she adds.

On EVs, Chin says that while higher fuel prices do make them more attractive, she does not expect adoption to suddenly accelerate.

“Growth should still be there, but more gradual. The main issues haven’t really changed, upfront prices are still high, charging infrastructure isn’t fully developed yet, and there’s still some uncertainty around policies.

“Plus, if electricity tariffs go up, some of the cost savings from switching to EVs may not be as compelling for the average consumer,” she says.

Overall, Chin says the auto sector will still be challenged for the time being.

“Entry-level internal combustion engine cars, especially from national brands, should hold up relatively well, given affordability, but diesel vehicles could see weaker demand due to higher fuel sensitivity.

“EVs and hybrids will continue to gain traction over time, but for now, it’s unlikely that they can fully offset the broader slowdown in overall vehicle sales,” she adds.

Meanwhile, Kenanga Research says it expects a gradual transition to battery EVs, which currently enjoys tax exemption up until 2027 for locally-assembled complete knocked downs.

Looking ahead, the research house has a balanced view of EV adoption eventually picking up and petrol vehicles demand peaking.

“But we do not think that will happen in the next five years due to infrastructure challenges,” it says in a recent report.

February’s TIV plunged 18% month-on-month and 20% y-o-y on shorter working month due to the double celebration of Chinese New Year and Hari Raya taking place in quicker succession versus the previous year.

Expectations are for March’s TIV to stabilise and see a slight recovery from February’s figures.

But with the increasingly cautious economic environment due to the flare ups in geopolitical tensions, it is still too early to conclude that EVs will continue to see strong growth in the country.