On April 17, Sim Tze Tzin, Deputy Minister of Investment, Trade, and Industry (MITI) of Malaysia, responded to rumors regarding potential changes to BYD’s plan to build a factory in Tanjung Malim, Perak.
He emphasized that the government must carefully balance national macro-strategy with the interests of the local supply chain when approving foreign investment. While high-value investments are welcome, he stressed they will not come at the expense of the domestic automotive industry. Currently, the entry barriers set for electric vehicle companies like BYD have triggered intense debate between the federal and state governments.
At the core of the controversy are several "hard conditions" set by MITI. According to Malaysian media reports, the government requires that 80% of BYD’s locally assembled products must be exported, with only 20% allowed for the domestic Malaysian market. Furthermore, the starting price for vehicles sold domestically must not be lower than 200,000 MYR. Sim explained that given Malaysia’s limited market size and the presence of over a thousand Chinese automakers, failing to regulate through export ratios and price floors would not only threaten the survival of Proton and Perodua but also destabilize the sustainability of the entire local automotive ecosystem.
This stance has drawn sharp criticism from the Perak state government. Loh Sze Yee, a member of the Perak State Executive Council, accused MITI of introducing a "non-transparent" new policy framework that has severely undermined investor confidence and caused construction of the plant—originally scheduled for production in 2026—to stall. In response to local government concerns, Sim reaffirmed that approval criteria are based on the National Automotive Policy and the New Industrial Master Plan 2030, aimed at promoting technology transfer and high-value-added production. He revealed that 13 Chinese brands have already been approved to enter Malaysia, noting that even if BYD ultimately decides against local manufacturing, it can continue operations through Completely Built-Up (CBU) imports or local assembly (CKD) partnerships.