Own a 20 Y/O Car? Scrap It for RM4K off a New Proton/Perodua

By Danial Martinus • 28 Jan 2026 in Cars

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The Malaysian government is making life a little easier for people who own old cars that have seen better days (or decades, more like), wanting to make the switch to a more modern set of wheels.

As part of the new Matching Grant Programme announced in Budget 2026, anyone willing to part ways with a vehicle 20 years or older and replace it with a brand new Proton or Perodua could walk away with up to RM4,000 in incentives.

With RM10 million set aside for the initiative, roughly 5,000 vehicle owners can benefit from the programme instead of letting their cars sit idle on the roadside, collecting dust and rust.

RM2,000 from the government + RM2,000 from the manufacturer

According to Transport Minister Anthony Loke, the scheme acts as a more practical nudge towards safer roads and a cleaner vehicle ecosystem.

Eligible vehicle owners will receive RM2,000 from the government, with the manufacturer of their car (either Proton or Perodua) matching that grant, equalling up to RM4,000 in total.

“This will increase the total incentive received by the public and reduce the overall cost of purchasing a new vehicle,” Loke says.

Most Proton models qualify for the new scheme, with the exception of the new Proton Saga and e.Mas 5, which will receive a lower total incentive of RM2,000. Perodua models are also part of the scheme, but no exceptions have been made in terms of grant eligibility.

At its core, the scheme reinforces the government’s push to support local automakers, while also tackling congestion and safety issues. Just last year alone, 820,000 new cars were sold in Malaysia. But this doesn’t mean that old cars get taken off the road whenever a new one enters.

Add to that their lack of basic features such as airbags, electronic stability control, advanced braking systems, and more, one can see how they pose a potential road hazard as newer cars have to share the same space as them.

“As the number of vehicles continues to grow, our challenge is to ensure that whenever new vehicles enter the system, old vehicles are taken off the road,” Loke says.

Loke also clarified that if you’ve got a sentimental attachment to your old car, you won’t be forced to scrap it. In fact, some classic cars can fetch higher value on the second-hand market, which is totally fine. The scheme only targets people whose cars are a little worse for wear.

With nearly 19.7 million cars registered in Malaysia, a sizeable four million of them are inactive for three years or longer. That’s a lot of idle cars taking up valuable space.