Proton’s Budget 2027 wishlist – long-term xEV policy, promote local sourcing, vehicle renewal framework

After the Malaysian Automotive Association (MAA), it’s now Proton’s turn to say what it hopes to see in Budget 2027, which is set to be tabled in parliament next Friday, October 9. Spoiler alert – they’re strikingly along the same lines.

Speaking to Bernama, deputy CEO Datuk Ir Abdul Rashid Musa called for a long-term and technology-inclusive automotive policy to support electrified vehicles (xEVs), which comprise hybrids, plug-in hybrids (PHEV), battery-electric (EV) and fuel-cell vehicles. He said government support is needed to “incentivise growth in upstream activities and strengthen the vendor ecosystem to achieve our national aspiration of increased localisation.”

“By bringing more technologies and suppliers to Malaysia as well as encouraging local sourcing, the industry would be able to lower development and parts costs, helping to make the move towards electrification more affordable for Malaysians,” Rashid told Bernama.

He added that the policy should recognise that Malaysia’s xEV transition will impact all areas in the sector, and that a managed approach is needed to balance industry players’ needs with gradually building national readiness for xEVs.

Through its eMas sub-brand, Proton is by far Malaysia’s leading xEV company, having sold over 40,000 cars – eMas 7, eMas 5 and eMas 7 PHEV – since its 2024 inception. Almost 70% of that figure were sold this year (so far).

xEVs aside, Proton also hopes for a long-term national vehicle renewal and recycling framework, with Rashid citing the encouraging reception of the government’s matching grant to incentivise the replacement of vehicles aged 20 years and up, announced in Budget 2026. The RM10 million allocation was used up within three months, he said.

“Expanding this programme will also help reduce the government’s fuel subsidy bill and provide safer cars with high technology and provide better fuel efficiency for more Malaysians,” Rashid said, stressing that the intention was not to force Malaysians to replace their vehicles or introduce more financial burden, but to provide practical and affordable ways for them to retire vehicles that were no longer safe, efficient or economical to maintain.

Accelerating the development of local technology, talent and suppliers is also on Proton’s Budget 2027 wishlist, with the deputy CEO calling for stronger national programmes to help Malaysia move from assembling vehicles to designing, engineering and developing automotive technologies.

“Support can be directed towards shared capabilities that benefit the entire industry, including automotive research, software development, artificial intelligence, battery technology, advanced electronics, testing facilities and vehicle homologation,” Rashid said, adding that carmakers, local vendors, universities and technical institutions should work together more closely to boost competency levels and create a ready base of skilled workers.