KUALA LUMPUR (June 26): Bermaz Auto Bhd (KL:BAUTO) scrapped an agreement to distribute Deepal-branded electric vehicles in Malaysia after failing to finalise the commercial terms.

The immediate termination with brand owner Chongqing Changan Automobile Co Ltd was mutual, Bermaz Auto said in an exchange filing. Bermaz Changan Sdn Bhd, the unit set up for the business, never started operations since its incorporation in November 2024, the company noted.

The parties had been negotiating on, among others, the models and retail price in Malaysia but decided not to go ahead amid price war in the local electric vehicle market, Bermaz Auto said.

The deal is one of the casualties of the deluge of Chinese-branded electric vehicles that often comes with attractive prices while packing more features.

Data from the Malaysian Automotive Association showed the number of new electric vehicles, including hybrids, had jumped nearly nine times since 2022 when the government rolled out tax incentives for fully imported models. The incentive ended in 2025.

The termination of Deepal distributorship it is in the best interests of Bermaz Auto, the company added. Bermaz Auto mainly assembles and sells Mazda-branded vehicles in Malaysia.

The termination leaves XPeng as Bermaz Auto's only dedicated electric vehicle marque in Malaysia, distributed through its 85%-owned subsidiary Bermaz XPeng Sdn Bhd. Bermaz Auto had dropped the distribution of Kia in 2025 and Peugeot in 2024.

Shares of Bermaz Auto closed down three sen or 2.9% at RM1.01 on Friday, valuing the group at RM1.2 billion ahead of the announcement.