BYD Responds to Malaysia's New CBU EV Policy: We Will Find the Best Solution Together

As the Ministry of Investment, Trade and Industry (MITI) prepares to enforce stricter regulations on fully-imported (CBU) electric vehicles from July 2026, all eyes are on BYD — currently the frontrunner in Malaysia's EV market.

Recently, Liu Xueliang, General Manager and Vice President of BYD's Asia Pacific Auto Sales Division, gave his first official response to the upcoming policy during the grand opening of BYD Mansion Macalister in Penang. He emphasised that BYD fully respects Malaysia's automotive industrial policies and will not retreat, but will instead deepen its commitment to the local market.

Recap of the July 2026 Policy: The End of Affordable CBU EVs?

The new regulations require all imported CBU EVs to meet two strict criteria:

• A minimum CIF value of RM200,000.
• A minimum power output of 180 kW (approximately 245 PS).

This effectively shuts the door on many mass-market, value-for-money imported EVs.

Looking at BYD's current bestsellers in Malaysia:

• Models like the Atto 3, Dolphin, M6, and Seal 6 DM-i mostly fall below the 180 kW threshold.
• The Seal and Sealion 7 meet the power requirement, but continuing to sell them as CBUs would require artificially inflating the CIF value above RM200,000, significantly raising retail prices and hurting competitiveness.

BYD's Response: Seeking Win-Win Solutions

Instead of confrontation, BYD has chosen a cooperative approach. Liu Xueliang stated diplomatically:

"We have noted the Malaysian government's new policies on new energy vehicles. As a responsible technology company, we will continue to bring our best technologies and products to Malaysia."

"Together with the relevant Malaysian authorities, as well as our industry and dealer partners (including Sime Darby Motors), we will work to find the most suitable NEV development path for the Malaysian market."

The Malaysian government's clear intention is to encourage foreign brands to establish local CKD assembly, thereby upgrading the domestic automotive supply chain.

Although rumours previously suggested BYD was considering a plant in Tanjung Malim, Perak, MITI's stringent conditions (including a minimum retail price of RM100,000 and 80% export requirement) mean negotiations are still ongoing.

Turning Challenge into Opportunity: BYD's Three Strategic Directions

Despite the policy headwinds, market observers believe BYD is well-prepared. Malaysian consumers can look forward to three major shifts:

1. Expansion into East Malaysia

Liu specifically revealed during the event that he personally visited East Malaysia last year and deeply felt the strong demand from consumers in Sabah and Sarawak for BYD's technology and products. He promised to bring BYD's latest technologies and products to East Malaysia. This indicates that East Malaysia will become a vital battlefield for BYD to expand its sales and service network.

2. Premium and High-Performance Shift

Since the route for low-output, low-priced CBU vehicles is restricted, BYD's local product strategy will inevitably undergo a "premium upgrade". Leveraging BYD's massive global product portfolio, more high-end models are expected to arrive. Aside from high-performance EVs, BYD's personalized brand Fang Cheng Bao, and even its ultra-luxury brand Yangwang, could potentially make their Malaysian debut in compliance with the new policy.

3. Local CKD Production for Best-Sellers

The most viable path for popular models like the Atto 3 and Dolphin is local assembly. The race is now on among Chinese brands to establish CKD operations in Malaysia.

Editor's Take

The golden era of cheap imported EVs in Malaysia may be coming to an end in July. However, as hinted by BYD, this is not the end of the EV market, but a "survival of the fittest" reset.

The future Malaysian EV landscape will likely consist of either premium, high-tech imported models or competitively priced locally assembled vehicles.

As a consumer, are you more excited about BYD localising its popular models, or about the potential arrival of high-end offerings like Yangwang and Fang Cheng Bao?