Quieter restaurants, vacant retail lots as Langkawi ends duty-free perk for supercars

Langkawi's allure has dimmed for the ultra-wealthy following the cessation of its duty-free perk for supercars. The island, once a magnet for high-net-worth individuals seeking luxury vehicles, now faces quieter high-end restaurants and empty prime retail lots. This shift has impacted a range of businesses, from hotels to small tourist attraction operators.

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Supercar lovers used to book hotel rooms as a group, dine out and go on joyrides around the island.

Mohamad Azhar Mohd Jamil, a veteran of Langkawi's supercar sales and servicing industry, noted the immediate impact. "Their cars just sit in our garages now. The owners seem to have lost interest in coming and it affects everyone," he said. While used and new supercars under RM300,000 remain duty-free, dealers can no longer display them in showrooms, a significant blow to sales and the rental of prime retail spaces.

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Their cars just sit in our garages now. The owners seem to have lost interest in coming and it affects everyone from hotels to small tourist attraction operators.

Luxury vehicles exceeding RM300,000 have lost their tax exemptions since 2026, dramatically increasing prices. For instance, supercars like Ferraris and Lamborghinis that once cost around RM2.5 million now exceed RM5 million. Dealers are urging the government to review the policy, requesting flexibility or partial reinstatement to sustain their operations.

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We are just asking for some flexibility or even a partial reinstatement so we can continue operating.

Norsidah Ahmad, sales and marketing director at Holiday Villa Beach Resort and Spa Langkawi, acknowledged the absence of these affluent clients, who previously combined vehicle purchases with holidays and generated significant hotel revenue through automotive club events. Similarly, industry veteran Ong Seng Aun, whose specialized business stores and maintains supercars, has seen his income drop by over 50 percent. He previously housed up to 300 luxury cars but now has fewer than 100, with many owners retrieving their vehicles. This downturn has also affected related sectors like vehicle transport and maintenance, forcing skilled workers to seek alternative employment.

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Without the duty-free status on supercars, opportunities to host automotive club events that generate hotel room nights may be declining.