MOT launches old vehicle replacement scheme: Only 5,000 slots available

The Malaysian government today has officially launched the Matching Grant Programme for the Replacement of Old Vehicle. The cash for clunkers initiative for vehicles over 20 years old was first announced by Prime Minister Anwar Ibrahim during the tabling of Budget 2026 last October.

Even though the official launch of the programme took place today, in-depth details, including eligibility, will only be announced at a later date. Nevertheless, several rudimentary pieces of information regarding the initiative have been revealed by the Transport Minisster, Anthony Loke during the programme’s launch event.

For one, eligible owners will be provided with a grant of up to RM2,000 by the government, which can be used towards the purchase of a new vehicle. The grant will then be matched by Proton or Perodua, depending on the model that they choose.

Speaking about eligible models, all Proton models are eligible for the full RM4,000 grant, except for the 2026 all-new Saga and 2026 e.MAS 5, which are limited to RM2,000. As for Perodua, the eligible models will be announced by the carmaker in due course.

While the exact mechanism for the programme is still under wraps, the journey that applicants will go through appears to be fairly simple. According to the presentation at the launch event, the process begins by submitting a registration form together with required documents at the dealership.

Once the application has been approved, the showroom will then book the new car for the applicant. At the same time, Authorised Automotive Treatment Facilities (AATF) will reach out in order to start the disposal process for the old vehicle.

Do note that the old vehicle must not have been blacklisted by JPJ or PDRM, nor have any outstanding bank loans and restrictions by the Customs Department, in order to be legally disposed of.

The disposal process begins with vehicle deregistration, in which applicants can do it at Road Transport Department (JPJ) branches or through the Online Vehicle Deregistration System (e-DeREG). Once the vehicle has been deregistered, a document called JPJ K1D will be issued, and the AATF can now collect your car for disposal.

Once the vehicle has been properly disposed of by the AATF, the applicant will then receive the vehicle’s Certificate of Destruction. They can then visit the dealership once again to complete the purchase of their new car.

According to the Minister of Transport, Anthony Loke, the programme has received an allocation of RM10 million, which is enough to cover 5,000 vehicles. During his speech at the launch event, the minister challenged both national automakers to use up all the allocations within 6 months.