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How to buy a car in Malaysia as a foreigner: US guide
If you're living or working in Malaysia as an American expat, you likely want your own vehicle for daily errands, weekend trips, and the overall convenience of not having to rely on public transport.
You may also feel that it's safer to drive a car than a motorcycle, which is popular in Malaysia.
Buying a car in Malaysia is relatively straightforward and feels similar to the process back in the US, with pretty basic steps like choosing a vehicle and completing registration.
However, there are quite a few important things that you need to know about the process before you start looking for your new vehicle. Here's what Americans should know about buying, registering, and driving a car in Malaysia.
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Can Americans buy a car in Malaysia?
Yes, Americans can buy cars in Malaysia, but it typically only makes practical sense when you're planning a long-term stay.
For short trips or visits lasting a few months, renting makes more financial sense than purchasing. It allows you to avoid the up-front costs, registration hassle, and the challenge of selling when you leave.
However, if you're working or living in Malaysia for an extended period, owning a car often becomes worth it, especially if you have a family.
Luckily, foreigners can legally purchase, register, and insure vehicles in their own names, and the process is usually pretty smooth.
What are the requirements to buy a car in Malaysia as a foreigner?
Generally speaking, you'll need the following documents to buy a car in Malaysia as a foreigner and start driving it:
- Valid passport
- Work permit or long-term visa
- Malaysian proof of address (utility bill or tenancy agreement)
- Valid driver's license with an International Driving Permit or a Malaysian license
- Car insurance
Americans can drive in Malaysia with a US driver's license if they hold both a valid license and a valid International Driving Permit issued in the US.¹
That said, if you're staying in Malaysia long-term, getting a Malaysian driver's license makes sense and simplifies interactions with authorities.
Financing is theoretically available to foreigners, but the reality is that lenders typically require large down payments, charge high interest rates, and may demand a local guarantor who agrees to cover the loan if you default. Practically speaking, it isn't easy to qualify.
Many expats end up paying cash or bringing funds from abroad.
Types of cars to buy in Malaysia
New cars
Getting a new car is usually the easiest way to buy a car in Malaysia, and your vehicle will come with a manufacturer's warranty and no maintenance issues. Many people enjoy driving a new car.
However, new vehicles also cost significantly more up front, and cars in Malaysia are already quite expensive. The advantage is reliability, but since most expats have to pay in cash, a new car can be hard to afford.
Used cars
Used cars cost less than new vehicles and usually make sense for expats who plan to leave Malaysia eventually. You'll likely see many well-maintained options at attractive prices, but it's very important to inspect them with a mechanic to make sure that there are no hidden issues.
Used cars require more due diligence, but they'll help you save money.
Where to buy a car in Malaysia
Here are a few options for where you can start your search for a car in Malaysia:
-
Authorized dealerships: Brand showrooms are the most straightforward option if you want to buy a new car with a warranty
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Used car dealers: You can visit small and large dealers in Malaysia to view pre-owned vehicles — there are plenty of options
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Online marketplaces: You can use websites like Mudah.my to connect with private sellers and dealerships
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Private sellers: If you know someone who is selling their car, such as a fellow expat who's going back to their home country, you can buy their vehicle, usually at a good price
Generally speaking, it's a good idea to start your search online to compare prices and options before visiting dealerships or arranging private viewings.
You should also look for a trusted mechanic to help you inspect the cars you're seriously considering if you're looking to buy a used vehicle.
How much is a car in Malaysia?
Cars in Malaysia can be pretty expensive, especially if you're buying a new vehicle. On the upside, things like registration fees and annual taxes are pretty affordable.
Here's what to expect:
| Expense | Average cost² ³ |
|---|---|
| Volkswagen Golf 1.5 (new compact car) | 41,835 USD |
| Toyota Corolla sedan 1.6 (new mid-size car) | 33,733 USD |
| Registration fee (one-time) | 50 USD |
| Road tax (annual, standard 4-cylinder) | 12 USD to 22 USD |
| Car insurance (annual) | Varies by vehicle and coverage |
Car insurance coverage is mandatory in Malaysia.
Beyond these initial and annual costs, you'll spend money on regular maintenance like oil changes and tire replacements, fuel, parking fees, and occasional repairs as your vehicle ages. Used cars typically need more maintenance than brand-new vehicles.
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How to buy a car in Malaysia: step by step
1. Prepare your documents
Gather your passport, work permit/visa, proof of Malaysian address, and driver's license with an International Driving Permit before shopping for cars. You'll need these documents at different stages of the process, such as registration and buying insurance.
2. Set your budget
Figure out what you can afford to pay for your car plus insurance. Annual taxes and registration fees are pretty low in Malaysia, so those won't be big expenses.
You can also try applying for financing, but it can be difficult for foreigners, especially if you don't have an established credit history in Malaysia.
3. Find your car
Search online marketplaces, visit dealerships, and check expat groups for available vehicles. It's smart to compare prices across multiple sources before committing to anything.
4. Inspect and test drive
Examine the cars you're considering carefully and take them for a test drive. For used vehicles, you should usually pay a mechanic to inspect them before you buy.
5. Arrange insurance
All car owners in Malaysia are legally required to hold auto insurance (called insurans kereta in Malay), and you'll typically need proof of coverage for registration.
6. Buy your car
Pay for the vehicle and get a receipt with the sale details. You can usually pay by card or bank transfer, and private sellers often accept cash.
7. Register the ownership change
You must register the change of ownership with the JPJ (Road Transport Department) within 3 months of buying your car.³
This updates your car's registration certificate and legally confirms you as the owner.
If you bought through a dealership, they'll normally handle this process for you, but make sure to confirm that this is included in the price.
8. Pay road tax
After registration, pay your annual road tax and display the road tax disc on your windscreen.
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Driving in Malaysia: Requirements
Driving in Malaysia shares some similarities with the US, but the road conditions will likely feel quite different, especially at first. Here's what to keep in mind:
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Malaysia drives on the left side of the road, so you'll need to adjust because it's opposite to the US
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You can drive with your US license and International Driving Permit initially, but you should get a Malaysian license if you're staying long-term
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Motorcycles and scooters are everywhere and often weave between lanes, so stay alert and check your mirrors frequently
Overall, Malaysian driving culture can feel more aggressive than what you're used to in the US. There may be frequent lane changes and less predictable traffic patterns.
However, it’s safe overall, and you’ll likely get used to it after a little bit of time.
How to import a car from Malaysia to the US
Some Americans think about importing their Malaysian car back to the US. Theoretically, it's possible to do. However, practically, it can be very complicated and expensive.
Your vehicle will need to meet the Department of Transportation and EPA safety and emissions standards, and this means that you'll most likely have to make quite a few modifications to it.
Plus, you'll have to pay for shipping, and Malaysia is quite far from the US, which means that the shipping will be very expensive.
Generally speaking, it's much more common to sell your Malaysian car before going back to the US.
Buying a car in Malaysia as a foreigner is relatively easy, especially when compared to many other countries. The process usually feels familiar to Americans.
However, one cost that's easy to overlook is the expense of transferring money internationally to Malaysia to pay for your car.
Typically, American expats use international wire transfers or their US cards to make the purchase, and banks often charge high fees and currency exchange rate markups that can add hundreds or thousands to the total cost.
You can try an alternative like Wise to save money on fees.
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Sources
- US Embassy in Malaysia - Driver’s License Affidavit
- Numbeo - Cost of Living in Malaysia
- Monito - Can a foreigner buy a car in Malaysia
*Please see terms of use and product availability for your region or visit Wise fees and pricing for the most up to date pricing and fee information.
This publication is provided for general information purposes and does not constitute legal, tax or other professional advice from Wise Payments Limited or its subsidiaries and its affiliates, and it is not intended as a substitute for obtaining advice from a financial advisor or any other professional.
We make no representations, warranties or guarantees, whether expressed or implied, that the content in the publication is accurate, complete or up to date.
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