As battery electric vehicle (BEV) adoption falls in some countries, hybrids — alongside their plug-in and range-extended variants — are quickly gaining traction among consumers as a viable alternative. These vehicles are increasingly seen as a practical bridge between internal combustion engine (ICE) cars and full BEVs.

According to Jeevansing Jarwal, lead analyst of global research firm Mordor Intelligence’s Automotive and Aerospace team, India’s BEV sales in 2024 made up about 2% of new passenger vehicle sales, up 1.5 percentage points from 2020. In contrast, hybrid vehicle sales rose by four percentage points over the same period.

Across Asean, hybrid vehicles are seeing significant growth alongside full BEVs, with Thailand seeing a 150% surge in hybrid vehicle sales, despite a dip in BEV uptake, according to Jeevansing.

Jigar Shah, head of sustainability research at Maybank Investment Banking Group, notes that this dip in EV sales compared to hybrids has been observed in some regions.

In the second half of 2024 (2H2024), there was a slowdown in the adoption of BEVs in the European and US markets. The latter witnessed a 41% year-on-year increase in the sale of hybrids in 1H2025, versus an increase of 6.3% y-o-y for full EVs.

“Full EV demand and adoption rates should remain buoyant, owing to mandatory adoption timelines in certain jurisdictions and increased cost effectiveness of ownership as more models are launched at competitive prices.” – Jigar, Maybank Investment Banking Group
“We believe the decline in full EVs in Europe in 2024 was due mainly to near-term saturation in the market after years of strong EV sales,” says Jigar.

This is not a uniform trend, however. BEVs saw rising sales figures in some other geographies. For instance, Jigar highlights that in 1H2025, Malaysia EV car sales saw an increase of 61% y-o-y growth versus 21% for hybrids.

Meanwhile, Singapore witnessed an increase of 63% in the sale of BEVs versus 13% for hybrids in 1H2025. Indonesia reported full BEV sales increase of 169% compared with 10% in hybrids in the same period.

“Full EV demand and adoption rates should remain buoyant, owing to mandatory adoption timelines in certain jurisdictions and increased cost effectiveness of ownership as more models are launched at competitive prices,” says Jigar.

EVs more of a lifestyle-oriented vehicle
On the industry side, this rise in popularity among hybrid vehicles has caught the attention of manufacturers, especially those that sell products across the ICE, EV and hybrid range.

“For most of our customers, EVs are currently viewed more as lifestyle-oriented vehicles, suitable primarily for urban dwellers whose daily commutes are within city limits.”- Chew, Chery Auto Malaysia
“For most of our customers, EVs are currently viewed more as lifestyle-oriented vehicles, suitable primarily for urban dwellers whose daily commutes are within city limits, where charging stations are more readily available,” says Michael Chew, vice-president of Chery Auto Malaysia.

Chew sees this trend in Malaysia, where ICE vehicles remain the preferred choice for many first-time car buyers, with a notable uptick in EV adoption coming from luxury brand vehicles.

For example, BMW is seeing success in its growing EV line-up. According to Benjamin Nagel, managing director of BMW Group Malaysia, the company saw a 13.5% growth in its full EV segment in 2024, delivering more than 426,000 EVs worldwide.

“Our performance in Malaysia in 2024 aligns with this regional growth, delivering more than 2,700 EVs in 2024, an impressive 20.5% of our total vehicle deliveries,” he says.

Since May 2025, EVs have made up 37.9% of BMW’s vehicle output, rising from 16% y-o-y. While the company has not entered the hybrid space yet, this shows that EVs are popular with high-end car brands, and the company plans to introduce more EVs in its line-up.

Chew notes that while Malaysia continues to grow its EV charging infrastructure, range anxiety remains a persistent concern among Malaysian drivers, even in urban areas. This issue has led to automotive players doubling down on hybrid vehicles to offer a safer option.

Chery’s hybrid vehicle Tiggo Cross is an example. It is a suitable alternative for drivers with range anxiety, says Chew, as it offers the reliability of ICE cars while lowering their carbon emissions.

“With a full tank of petrol and one full charge, it can deliver an impressive driving range of up to 1,000km. For many drivers, that’s enough to last an entire month without needing to refuel or recharge,” he says.

Increasing appeal of hybrids
While Chery sells EVs and hybrids, its ICE models remain its best-sellers for now. Yet, Chew believes hybrid sales will soon catch up, driven by their ability to address common concerns while offering a familiar driving experience.

This is why he anticipates that hybrids and plug-in hybrid electric vehicles (PHEVs) will become a popular choice, as they offer the best of both worlds: the efficiency and lower emissions of electrification, along with the flexibility and fast refuelling of a traditional engine.

“Beyond range anxiety, we believe Malaysians highly value convenience. Many drivers are not yet ready to trade the quick and familiar experience of refuelling, which takes less than 10 minutes, for longer EV charging times. After all, we have enjoyed the ease of petrol-powered mobility for decades,” says Chew.

This increasing popularity of hybrids does not mean the hype around EVs is dying, though; it could also be a sign of a practical step towards eventual full electrification.

“[Hybrid vehicles] offer customers the benefits of electric driving, with the added confidence of an internal combustion engine, ideal for longer journeys or areas where charging infrastructure is still growing. While range anxiety was once a barrier, rapid advancements in battery efficiency and charging network expansion are addressing this issue,” says Nagel.

Rather than posing a competition for EV adoption, he sees hybrids’ increasing popularity complementing it. This point is reflected in the sales number of BEVs and PHEVs, which hit 17 million units in 2024, up 25% y-o-y. China, Europe and the US lead this growth, according to Mordor’s Jeevansing.

Nationwide shift to locally manufactured EVs
To overcome affordability and infrastructure barriers, Malaysia has introduced tax incentives for locally assembled EVs, or completely knocked down (CKD) units.

These units are exempt from import, excise and sales taxes until end-2027, encouraging manufacturers such as Chery and Automa to begin local assembly and making EVs more accessible to the Malaysian market.

In emerging markets such as Malaysia, where affordability, infrastructure and user experience are key considerations, such policies are essential, says Chew.

“There is an opportunity to further strengthen EV adoption by extending certain tax exemptions to individual EV owners, not just manufacturers. This would reinforce public confidence, lower entry barriers and incentivise more consumers to make the switch to electric mobility,” he adds.

Chew stresses that long-term success will require holistic government support, not just for buyers and automakers, but also for the entire ecosystem.

“To sustain momentum, government support must … foster a comprehensive local EV ecosystem that includes accessible pricing, nationwide charging infrastructure and long-term ownership support.”

Another concern of EV owners that must be addressed is the cost of replacing EV batteries, which can exceed RM10,000, according to industry players. The value of secondhand EVs is also low at the moment.