PETALING JAYA: The auto sales momentum is expected to ease in April as cautious consumer sentiment and external risks weigh on demand, while tighter fuel subsidy quotas may support electric vehicle (EV) and plug-in hybrid (PHEV) adoption.
BIMB Research said post-festive momentum in car sales is likely to “fade” following a Hari Raya-driven surge in March, even as underlying demand remains uneven.
“In particular, the US-Iran conflict has introduced fresh uncertainty through elevated oil prices, supply chain risks and weaker sentiments.”
While Budi95 fuel subsidy mechanism continues to provide some near-term relief, it warned that recent policy changes could begin to feed into broader cost structures.
“While Malaysia’s RON95 subsidy provides near-term cushioning, the reduction of the subsidised quota to 200 litres per month from April 2026 is expected to add cost pressures across logistics, production and imported components, potentially accelerating the long-term shift toward EV and PHEV adoption,” it added.
Against this backdrop, the research house expects the local automotive market to normalise after several years of an exceptionally strong performance, maintaining its total industry volume (TIV) forecast of about 740,000 units for 2026 as the sector shifts into a more sustainable phase.
This compares with a record high of 820,752 units in 2025, marking the second consecutive year that industry volumes exceeded the 800,000-unit level.
As such, the research house kept its “neutral” stance on the sector, citing limited upside catalysts in the near term.
Still, it said national marques are likely to remain the key volume drivers, supported by their affordability positioning, although softer demand conditions could limit overall growth.
“National players provide stability through affordability and EV offerings; however, softer demand, tighter budgets and downtrading will cap overall TIV growth,” BIMB Research said.
On a monthly basis, TIV rebounded strongly in March, supported by festive-driven deliveries ahead of Hari Raya, although volumes remained lower year-on-year (y-o-y).
TIV rose 21.1% month-on-month (m-o-m) to 72,966 units in March, comprising 68,406 passenger vehicles (of which 43,937 were national and 24,469 non-national) as well as 4,560 commercial vehicles.
However, this still represented a 13% decline y-o-y.
Passenger vehicle sales climbed 22.1% m-o-m but fell 13% y-o-y to 59,498 units, supported by pent-up demand and aggressive promotions, particularly from national marques.
“National players continued to anchor industry stability.
“Mass-market brands sustained volumes through strong affordability positioning amid tighter household budgets.”
