Once change to reducing balance loan, the interest rates will also go up. Will not be 2%+ anymore but will start from 4%+ or even higher base. Good for those who usually sell their cars or settle early but no difference if you plan to pay the full tenure.

If you want to see it that way, then yes. But even right now most people don't know how any of this works and just do as they like (i.e. change car based on their fancy). So, I don't think it will make much difference in this aspect. Depending on how the law is implemented, car companies may have more flexibility in providing fancy leasing & financing options that exist in Europe such as Mercedes-Benz Agility etc. (the current version in Malaysia is not as flexible as those in Germany). End of the day, will be win-win for all compared to being restricted to the stupid hire-purchase method for motor vehicles. Simple interest loans are a fucking scam.