Southeast Asia has recorded significant growth in electric vehicle (EV) adoption, with several countries reporting higher EV shares of new vehicle sales than some developed economies.

According to a June report by a leading global think tank, four ASEAN countries - Singapore, Thailand, Vietnam and Indonesia - overtook the United States and major European nations last year in terms of EVs' share of new vehicle sales.

In Singapore and Vietnam, EVs now account for 40% of all new vehicle sales. Five years ago, the figure in Vietnam was less than 0.05%. By comparison, EVs account for less than 6% of new vehicle sales in the United States.

In addition to economic considerations, EV adoption in Asia has been influenced by net-zero greenhouse gas emissions targets set for 2050 by several countries, including eight of ASEAN's 11 member states, as well as efforts to reduce dependence on crude oil imports.

Amid ongoing tensions in the Middle East, 55% of Asia's oil supplies pass through the region. According to the article, these supplies could potentially be disrupted by actions taken by the White House. According to an international think tank focused on the global transition to clean energy, the Strait of Hormuz crisis has disrupted 28% of ASEAN's oil consumption.

"Many Southeast Asian governments view EV adoption not only as a climate or industrial policy objective but also as a strategic energy security measure. By reducing reliance on imported petroleum products, EVs can help improve resilience against global oil market volatility and geopolitical disruptions, including those affecting key supply routes such as the Strait of Hormuz," an energy analyst told the media.

In a region experiencing rapid urbanisation and increasingly congested cities, EVs may contribute to reductions in air pollution and related healthcare costs. Malaysian Prime Minister Anwar Ibrahim has stated that local EV production supports economic, environmental and energy security objectives.

"We must accelerate a decisive shift in our energy strategy towards more sustainable, diversified and cost-effective sources," he said in April. "This is not merely an environmental necessity. It is a strategic necessity."

Many Southeast Asian countries have introduced incentives, tax benefits and other policy measures to encourage EV adoption. Laos, which is bordered by China, Vietnam, Thailand, Cambodia and Myanmar, has banned the import of all petrol- and diesel-powered vehicles for the remainder of this year.

The increase in EV adoption reflects a pattern previously observed in Southeast Asia. In 1993, Cambodia, whose infrastructure had been severely damaged by decades of conflict, became the first country in the world where mobile phone subscriptions exceeded the number of landlines.

Unlike the United States and Europe, Southeast Asian markets generally have less extensive petrol station networks, providing opportunities for the development of charging infrastructure.

Southeast Asia also holds reserves of several minerals used in EV production, including nickel and copper. Indonesia and the Philippines hold half of the world's proven nickel reserves and account for three-quarters of global production. Nickel is used in battery production to improve energy density and vehicle range.

The two countries also rank among the world's top five copper producers. Copper is used in electric motors, batteries and vehicle wiring. EV market growth in Southeast Asia has been supported in part by China, which accounts for 70% of global EV production and 60% of EV sales.

Chinese EV manufacturers, including BYD and SAIC Motor, have expanded their presence in Southeast Asia through vehicle sales and investments in local manufacturing operations.

BYD is investing US$ 1 billion in a 126-hectare manufacturing facility in West Java, Indonesia. Such investments have contributed to increased vehicle availability and charging infrastructure development across parts of the region.

Domestic manufacturers are also expanding their presence, including Vietnam's VinFast, a subsidiary of Vingroup. Vingroup is headed by Pham Nhat Vuong, the country's first US-dollar billionaire.

"Our market-leading position not only reflects strong business performance but also underscores the irreversible shift from internal combustion engine vehicles to electric vehicles in Vietnam," he told a shareholders' meeting last December following record monthly sales in November.

According to the energy analyst, Southeast Asia is expected to remain an important EV market and manufacturing region.

"Southeast Asia is likely to become an increasingly important EV market and manufacturing hub. The region's combination of growing demand, automotive manufacturing capabilities, critical mineral resources and government support creates significant opportunities. The long-term direction is clear: transportation electrification is likely to continue as EVs become more accessible and economically competitive," he said.