Market Overview - Malaysia's new vehicle market declined by over 19% to 52,414 units in February 2026 from 65,052 units in the same month last year, according to the Malaysian Automotive Association (MAA) [1] - The decline in February followed a 27% surge in January, attributed to fewer working days due to the timing of the Lunar New Year holidays [2] - In the first two months of 2026, the vehicle market increased slightly to 116,712 units, up from 115,501 units in the same period last year [2] Economic Context - Consumer sentiment has strengthened, reflected in a pickup in economic growth to 6.3% year-on-year in Q4 2025, up from 5.4% in Q3 2025, driven by stronger domestic consumption, investment, and exports [3] - The economy expanded by 5.2% in 2025, slightly up from 5.1% in 2024 [3] Vehicle Sales Performance - Light passenger vehicle sales rose by 1% to 109,117 units in the first two months of 2026 from 108,339 units a year earlier, while commercial vehicle sales increased by 6% to 7,595 units from 7,162 units [4] - Battery electric vehicle (BEV) sales surged by 154% to 9,870 units in this period from 3,850 units a year earlier, led by the Proton eMas 5 with 4,630 units [4] Production and Forecast - Vehicle production in Malaysia fell by 7% to 110,607 units in the first two months of the year, down from 119,540 units a year earlier [5] - The vehicle market is expected to rebound in March, but full-year sales are projected to weaken, with GlobalData forecasting a nearly 6% drop in light vehicle sales to 779,000 units in 2026 [5] Company-Specific Performance - Market leader Perodua's sales fell by 9% to 49,703 units in the first two months of 2026, despite launching the new Traz compact SUV and its first BEV model [6] - Proton reported a 58% increase in global vehicle sales to 33,399 units year-to-date, with the Saga being its best-selling model [6] - Toyota registrations rose by 13% to 13,591 units in the two-month period, aided by the introduction of new models [7]