BYD has abandoned plans to build its own CKD assembly plant in Tanjung Malim, Perak, but the company has not abandoned local assembly in Malaysia. In fact, all signs now point towards a contract-assembly arrangement with an existing local manufacturer.
BYD Sime Motors managing director Jacob Ma confirmed the cancellation yesterday, just over a year after BYD announced plans for a 600,000-square-metre facility at KLK TechPark in Tanjung Malim.
However, Ma made an important distinction – the Tanjung Malim plant is cancelled, but BYD’s CKD programme remains on the table.
He said BYD is currently in discussions with an established contract assembler in Malaysia and that the parties are working through the necessary documentation. No further details were disclosed, including the identity of the potential partner.
That leaves one particularly interesting possibility — Sime Motors’ own Inokom assembly plant in Kulim, Kedah.
There is no official confirmation that Inokom will assemble BYD vehicles, but the evidence surrounding the two companies makes it difficult to ignore.
Why Inokom is the obvious candidate
The strongest clue came in May, when BYD Asia Pacific Auto Sales Division vice-president and general manager Liu Xueliang visited Inokom’s facility in Kulim.
Then, earlier this month, Sime Motors’ leadership team travelled to BYD’s headquarters in Shenzhen for what Sime described as discussions to strengthen collaboration, facilitate knowledge transfer and align on strategic priorities for Malaysia.
Neither side specifically mentioned CKD during those engagements but the timing is significant.
Sime Motors is already BYD’s Malaysian distribution partner, while Inokom is an established contract manufacturer with decades of local assembly experience.
The Kulim plant spans around 200 acres and has body, paint and assembly operations. Inokom currently produces vehicles for several international brands and, importantly for BYD, already has experience assembling EVs.
That makes Inokom a considerably more straightforward proposition than building a completely new factory from the ground up.
BYD could avoid starting from zero
BYD’s original Tanjung Malim plan involved establishing an entirely new manufacturing operation. A contract-assembly arrangement changes that equation.
Instead of investing heavily in land, buildings, production infrastructure and manpower, BYD could utilise an existing facility with an established workforce, supplier network and manufacturing processes.
Inokom has also been expanding its capabilities. Its recently completed Paint Shop 3 investment increased total paint capacity at the Kulim facility, further strengthening its ability to handle additional vehicle programmes.
For BYD, this could provide a faster and potentially less capital-intensive route into Malaysian CKD production. It also gives the company greater flexibility as it continues to expand its EV line-up.
CKD is becoming increasingly important for BYD
The timing could hardly be more important. From July 1, 2026, newly approved fully imported EVs in Malaysia must meet a minimum CIF value of RM200,000 and minimum power output of 180 kW.
That effectively makes the CBU route far more challenging for mainstream EVs, particularly models positioned below the RM200,000 mark. BYD’s Malaysian success has been built largely around exactly this part of the market.
Models such as the ATTO 3 and Seal 6 are significantly more accessible than premium EVs, while the brand’s expanding range means maintaining competitive pricing will remain critical.
Local assembly therefore isn’t simply about reducing manufacturing costs. For BYD, CKD could become essential to maintaining a broad and competitively priced product range in Malaysia.
Why BYD may have changed direction
The cancellation of Tanjung Malim does not necessarily represent a reduction in BYD’s Malaysian ambitions. It could instead represent a change in strategy.
Building a dedicated factory makes sense when production volumes are sufficiently high to justify the investment. Contract assembly offers a different model: BYD can localise production while relying on an experienced manufacturing partner to handle much of the physical assembly infrastructure.
That approach is already becoming more common among EV brands entering Malaysia.
And with BYD’s regional manufacturing footprint expanding, particularly in Indonesia, there is arguably less reason for the company to duplicate every aspect of its manufacturing infrastructure in every market.
The question is no longer whether BYD wants to assemble vehicles in Malaysia. The question is who will assemble them.
All roads currently lead to Kulim
For now, Inokom remains speculation rather than confirmation but consider the sequence of events.
BYD originally announced its own Tanjung Malim plant in August 2025, with production targeted for 2026. Progress subsequently stalled, and MITI said as recently as August that it had not received formal confirmation from BYD on whether the project would proceed, be postponed or be changed.
Then came Liu Xueliang’s visit to Inokom in May. Sime Motors subsequently visited BYD’s Shenzhen headquarters.
And now BYD has confirmed that its own Tanjung Malim factory will not proceed, while simultaneously saying its CKD plans remain alive through an established contract assembler. That does not prove an Inokom-BYD deal.
But it certainly makes Inokom the most logical candidate currently visible in the public domain. If the partnership is eventually confirmed, BYD’s Malaysian-made EV story will take a very different route from what was announced in 2025.
Instead of a standalone BYD factory in Tanjung Malim, we could see BYD vehicles rolling off an established assembly line in Kulim, Kedah.
For Malaysian consumers, the more important point is what comes next. Local assembly could allow BYD to expand its range, remain competitive on pricing and potentially introduce more models that would be difficult to sell as fully imported vehicles under Malaysia’s latest EV regulations.
So while BYD’s Tanjung Malim factory is dead, its Malaysian CKD ambitions are very much alive, and if the clues are pointing in the right direction, Inokom may soon become the factory behind BYD’s next chapter in Malaysia.
