EV price war

Malaysia's electric vehicle (EV) market is heating up as automakers engage in an unprecedented price war, a move likely to deal a blow to the domestic automotive industry already expecting lower sales this year.

This is brought by a jaw-dropping price drop of the 2025 model year Atto 3 by Chinese auto giant BYD last week, without compromising its specifications and features, as well as the Chery Omoda E5 electric SUV early this week.

The former vehicle, known as Atto 3 Ultra, is priced at RM123,800, making it a staggering RM44,000 cheaper than when it was launched here in 2023.

The new price is likely in response to the Proton eMas 7 launched more than two months ago.

Proton recently extended the special launch package which lowered the pricing of the eMAS 7 to RM105,800 for the Prime variant and RM119,800 for the range-topping Premium variant.

On Monday, Chery Malaysia offered the Omoda E5 electric SUV for slightly less than RM120,000.

The new offer came just in time for the upcoming Raya holidays and also marked the first anniversary of the EV's release here.

Consumers can now get their hands on the Omoda E5 for RM119,800. When it was launched in the local market last year, the EV was priced at RM146,800 not inclusive of insurance. This means a saving of RM27,000.

Automotive analyst Hezeri Samsuri told Business Times that Malaysia has never witnessed an EV price war of this scale.

He pointed out that legacy automakers do not simply lower their prices in order to preserve brand stability and consumers trust.

In long term, price reductions have historically proven unsustainable but the current generation of consumers may be less concerned about this trend, he added.

Chinese automakers, Hezeri said, appear willing to take the risk.

"Whether this strategy will yield success remains to be seen. If the price reduction happens only once or twice, consumers might not be bothered and I believe consumers will now have more options within the same price bracket.

"In short, consumers win. In long term, depends on how many price cuts we will see within the next few months," he added.

Hezeri noted that the government has provided sufficient incentives and offering more would only weaken competition.

The government should now focus on charging infrastructure so that it will be competitive for charging point operators.

"Right now, the nation desperately needs the correct chargers in the correct areas as EV consumers are increasing and they can see beyond the introduction of chargers just to create positive optics. They want a proper charging network," Hezeri added.

Another analyst Shamsul Yunos deemed BYD's new price as a seasonal promotion that may end at any time instead of an outright cut.

He noted that the promotion might be aimed at clearing existing stock as the model recently undergone a facelift and update in China.

He said other brands may respond if they are already under pressure due to excessive stock. Otherwise they may hold on to their price positioning and weather the storm.

"Neither Tesla nor Hyundai have products that compete directly with the BYD Atto 3. Hence they will likely stay put. Proton's e.Mas7 is in the same price range but it is a much newer product and can stand the competition. Therefore, I don't think Proton will slash prices," he added.

Shamsul noted that historically, the government has not shown any inclination to intervene when there is market promotion.

He added that EV price competition is an ongoing process as carmakers find their level during this period of transition.

"When optimised, EVs have the potential to be cheaper to make than internal combustion engine cars as they contain less parts and are relatively easier to assemble. When it comes to cutting corners, most manufacturers try to reduce the cost in a way that is not noticeable by the end user," Shamsul said.

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