Towards an ASEAN–Japan Next-Generation Vehicle Industry Masterplan Aligning Industrial Transformation, Decarbonisation, and Regional Competitiveness

ASEAN’s automotive sector is undergoing a complex transition shaped by electrification, digitalisation, and decarbonisation, while remaining a key global production hub. Progress in electric vehicle adoption is notable, yet structural constraints persist, including policy uncertainty, weak market growth, and fragmented regional competitiveness. A diversified and phased transition—combining internal combustion engines, hybrids, electric vehicles, and sustainable fuels—offers a more resilient pathway than rapid electrification alone. Strengthening policy predictability, regional integration, and industrial transformation is essential. Enhanced ASEAN–Japan collaboration can accelerate technology transfer, investment, and supply chain development, positioning ASEAN as a competitive and adaptive player in the evolving global automotive ecosystem.

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