- Daihatsu will produce hybrid vehicles in Malaysia for the first time outside Japan.
- Malaysia’s growing HEV demand is driving new investments in local electrified vehicle production.
Daihatsu announced on May 14 that it will begin producing hybrid vehicles (HEVs) in Malaysia, marking the company’s first HEV production operation outside Japan. The initiative has been selected under the Ministry of Economy, Trade and Industry’s Fiscal Year 2024 Global South Future-Oriented Co-Creation Project. While the company did not reveal the exact production start timeline, the move represents a major step in Daihatsu’s overseas electrification strategy as demand for hybrid vehicles continues to expand across Southeast Asia.
Daihatsu plans to invest approximately JPY 8 billion into the project, including a government subsidy amounting to JPY 1.6 billion. The investment will support vehicle assembly operations and related manufacturing preparations in Malaysia. The coating and assembly processes for the hybrid vehicles will be conducted at the manufacturing facility operated by Perodua, Daihatsu’s Malaysian joint venture partner. The collaboration is expected to strengthen local production capabilities while supporting the broader regional transition toward lower-emission mobility solutions.
Malaysia HEV and EV Market Growth Overview
Malaysia’s automotive market has been experiencing steady growth in vehicle electrification, with multiple automakers introducing new electric vehicle models, particularly companies from China. In 2025, electric vehicle sales in Malaysia doubled compared to 2024 levels and reached 30,848 units. Hybrid vehicle sales also recorded notable growth, increasing by 25% year-on-year to 38,151 units. The relatively close sales volumes between EVs and HEVs indicate that hybrid vehicles continue to attract consumers who may still face concerns related to charging infrastructure availability and affordability.
According to Daihatsu, the company aims to further expand its HEV lineup in Malaysia as market demand evolves. The automaker also intends to contribute toward reducing carbon emissions through the wider adoption of electrified mobility technologies. Hybrid vehicles are expected to remain an important transition technology in markets where charging infrastructure development and income conditions may slow the full-scale adoption of battery electric vehicles.
Malaysia Electrified Vehicle Sales Comparison
| Vehicle Category | 2025 Sales Units | Growth vs 2024 |
|---|---|---|
| Electric Vehicles (EVs) | 30,848 | 2x Increase |
| Hybrid Vehicles (HEVs) | 38,151 | 25% Increase |
The Malaysian market continues to emerge as an important destination for electrified vehicle investment in Southeast Asia. Daihatsu’s decision to localize HEV production through Perodua is expected to improve supply flexibility and strengthen regional manufacturing efficiency. The project also aligns with government-backed initiatives aimed at supporting industrial cooperation and sustainable mobility development across emerging markets.
Frequently Asked Questions
Why is Daihatsu starting HEV production in Malaysia?
Daihatsu is launching HEV production in Malaysia to support rising demand for electrified vehicles and strengthen its regional manufacturing strategy. The company sees Malaysia as a growing market for hybrid vehicles due to increasing consumer interest in lower-emission mobility solutions. Challenges related to charging infrastructure and affordability continue to make HEVs attractive for many buyers. Through its partnership with Perodua, Daihatsu plans to improve local production capabilities while supporting carbon emission reduction efforts and expanding its hybrid vehicle lineup across the Malaysian automotive market.
How much is Daihatsu investing in the Malaysia HEV project?
Daihatsu plans to invest approximately JPY 8 billion into its Malaysia hybrid vehicle production initiative. This amount includes a government subsidy of JPY 1.6 billion provided under Japan’s Fiscal Year 2024 Global South Future-Oriented Co-Creation Project. The investment will be used for manufacturing preparation, vehicle assembly operations, and related facility upgrades. Production activities, including coating and assembly, will take place at Perodua’s plant in Malaysia. The investment reflects Daihatsu’s commitment to expanding electrified vehicle manufacturing outside Japan and strengthening its presence in Southeast Asia.
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