KUALA LUMPUR, Jan 20 — The Malaysian automotive industry achieved a milestone in 2025, recording a record-high total industry volume (TIV) for the second consecutive year.

According to data released today by the Malaysian Automotive Association (MAA), total vehicle sales reached 820,752 units, a marginal increase of 0.5 per cent from the 816,747 units sold in 2024.

Presenting the data, MAA president Mohd Shamsor Mohd Zain said the achievement underscored the resilience and robust performance of the automotive sector, which has surpassed the 800,000-unit mark for two years in a row.

He said the milestone reflected the industry’s adaptability and strategic growth amid evolving market dynamics.

“This performance was supported by resilient consumer demand, favourable financing conditions and the growing acceptance of electrified vehicles, reflecting the industry’s continued strength and transition towards more advanced and sustainable mobility,” Mohd Shamsor said.

The data showed that December 2025 recorded the highest monthly TIV on record, with 90,716 units sold, surpassing the previous high of 81,735 units in December 2024.

The fourth quarter of 2025 also posted a record quarterly TIV of 241,416 units, further highlighting the strength of the market.

Mohd Shamsor said several factors contributed to the sustained growth, including Malaysia’s strong economic performance, with GDP expanding by 4.7 per cent during the first three quarters of the year, driven by robust domestic demand and recovering exports.

Favourable financing conditions also played a key role, as the reduction of the overnight policy rate to 2.75 per cent in July 2025 improved vehicle loan affordability and made purchases more accessible to consumers.

Demand remained strong in the passenger vehicle segment, particularly for sport utility vehicles (SUVs), which grew by 13 per cent to 228,572 units sold in 2025, compared with 201,565 units in 2024.

In contrast, the commercial vehicle segment continued to decline, largely due to the removal of diesel subsidies in June 2024, resulting in an 11 per cent drop in 2025 after a 14 per cent decline the year before.

Looking ahead, the MAA projects a TIV of 790,000 vehicles in 2026, comprising 730,000 passenger vehicles and 60,000 commercial vehicles.

However, Mohd Shamsor cautioned that several challenges could affect the outlook, noting that GDP growth is expected to moderate to between 4.0 per cent and 4.5 per cent amid global trade uncertainties, including fluctuating US trade policies and ongoing geopolitical tensions.

“Inflationary pressures are also expected to affect manufacturing, component and operational costs, which could have an impact on vehicle pricing.

“Additionally, the expiry of tax incentives for imported electric vehicles (EVs), along with possible adjustments to excise duties and vehicle pricing calculations, may pose further challenges to vehicle sales in 2026,” he said.

Despite these headwinds, Mohd Shamsor said interest in electrified vehicles continues to grow as the industry moves towards more sustainable and advanced mobility solutions, although EV adoption remains at an early stage and requires greater emphasis on local assembly and development to improve market penetration.

He added that subsidised fuel prices could also slow the transition to EVs and weigh on demand.

The data showed that the combined market share of national automotive brands rose by 0.4 percentage points to 62.3 per cent, equivalent to 511,468 units, although growth slowed to 1.1 per cent.

Meanwhile, non-national brands saw sales decline to 309,258 units, mainly due to weaker performance in the commercial vehicle segment, whose market share fell from 9 per cent to 8 per cent in 2025.

Total industry production (TIP) stood at 747,780 units in 2025, a five per cent decline from the 790,347 units produced in 2024.

Mohd Shamsor said the drop, despite record TIV, reflected higher registrations of completely built-up battery electric vehicles (BEVs) ahead of the expiry of related incentives at the end of 2025, which accelerated BEV sales and demand.