Budget 2025: CARSOME Backs Measures to Boost Automotive Sector, Startup Ecosystem, and TVET
By Eric Cheng, CARSOME Group’s Co-founder, Chairman & Group CEO
Eric Cheng, CARSOME Group’s Co-founder, Chairman & Group CEO
Budget 2025 presents a pivotal opportunity for Malaysia to strengthen its economic foundations while addressing key challenges across industries. As a leading player in the automotive sector and tech ecosystem, CARSOME is encouraged by the government’s continued focus on supporting critical areas such as the startup ecosystem, automotive industry, and Technical and Vocational Education and Training (TVET). We believe these measures are vital for fostering long-term growth, innovation, and sustainable development, particularly as the country navigates ongoing economic shifts and global uncertainties.
At the same time, drawing on learnings after the-diesel subsidy rationalization in June 2024, we note that the planned rationalization of the RON95 fuel subsidy in mid-2025 will also significantly impact the automotive industry and Total Industry Volume (TIV) for petrol vehicles, particularly passenger cars.
While CARSOME supports subsidy rationalization as a fair and fiscally responsible measure, we are cognizant that careful and measured implementation mechanisms are crucial to ensure that 85% of the Rakyat continues to benefit from the subsidy and that those eligible do not slip through the safety nets. This is important, especially as petrol vehicles remain the most viable mobility option for many Malaysians.
The Budget 2025 also outlines significant support for venture capital (VC) funding, particularly through the establishment of the National Fund-of-Funds (NFOF) under Khazanah, the Dana Perintis under Retirement Fund Inc (KWAP), and increased allocation for Cradle Fund to support Malaysian startups.
CARSOME notes that increasing support towards the startup ecosystem has been a consistent theme and continuous effort in the three budgets under the MADANI Government. We see this as a positive step towards increasing local startups' access to capital across all growth phases to help them scale sustainably. In the long term, this also supports Malaysia’s aspirations as a leading regional startup hub.
We further commend the increased allocation for TVET as well as the Government’s commitment to increase TVET collaborations and partnerships with the private sector. The ability to use a higher percentage of HRDC funds for TVET training equipment and facilities is expected to drive private sector investment in this area.
This will help address the shortage of skilled and certified workers in the automotive industry, which has been a long standing issue. As a TVET provider through CARSOME Academy, we look forward to working closely with the Government to strengthen Malaysia’s TVET ecosystem and provide opportunities for Malaysian youths.
As a homegrown company, CARSOME remains committed to playing an active role in Malaysia’s economic growth, particularly through our support for the automotive industry, startup ecosystem, and TVET sector. We will continue to collaborate with industry stakeholders and the government to provide input for the successful adoption of the policies outlined in Budget 2025.
