PUTRAJAYA, Jan 27 — The government launched a national initiative today to encourage Malaysians to replace vehicles 20 years or older.
Transport Minister Anthony Loke said the Matching Grant to Replace Old Vehicles Programme, totalling RM10 million under the Budget 2026, is aimed at reducing the use of old vehicles that are unsafe, fuel-inefficient, and do not meet current safety standards, as well as boost demand for new local vehicles.
The incentive allows eligible vehicle owners to receive up to RM2,000 from local manufacturers, and the government will provide a matching grant of RM4,000 for the purchase of a new vehicle.
He added that 4.07 million, or 20.7 per cent of the 19.69 million registered vehicles in the country, had inactive road taxes for at least three years, indicating a concerning number of old and abandoned vehicles.
“Most of these vehicles are likely abandoned, can be safety risks, contribute to environmental pollution and cause disturbances for local communities if not managed systematically,” Loke said during the programme's launch today.
The move is aimed at reducing the number of old, no-longer-roadworthy vehicles, thereby reducing the risk of vehicular crashes and boosting motorist safety.
“Removing old vehicles from roads is not merely an administrative move, but a safety intervention capable of preventing tragedies, reducing injuries and saving lives,” he said.
Vehicles traded in must be disposed of by licensed disposal centres or Authorised Automotive Treatment Facilities to ensure the disposal process complies with legal and environmental standards.
The initiative is also supported by e-DeREG, an online vehicle deregistration system that allows owners to deregister their vehicles digitally.
“Besides benefiting Malaysians, the programme also supports the local automotive industry, boosts domestic demand and stimulates economic activity in the automotive industry chain and the recycling sector,” Loke said.
The minister also encouraged eligible owners to make the most of this opportunity, not only for the cost savings, but for their personal safety and that of their families and other motorists.
If the response is encouraging, his ministry will submit an application to the Finance Ministry for additional allocation to tackle the issue of old and abandoned vehicles.
The initiative will also be expanded to taxi drivers through a specific programme that will be announced in the future.
