The electric vehicle (EV) industry in Asia is entering a significant phase, with China, Thailand, and Vietnam playing key roles in shaping adoption through policy measures, technology development, and infrastructure expansion.

The EV market is undergoing a structural shift in 2025-2026, influenced by tax incentives, fleet electrification programmes, and increasing adoption in Asian and other emerging markets. These factors are accelerating decarbonisation and creating investment opportunities across regions and sectors.

Tax incentives and adoption in Asia

China has established itself as the leading EV market, with half of its 2024 car sales being electric. This growth has been supported by measures such as a CNY 20,000 (US$ 2,800) trade-in programme for older vehicles. Falling EV prices and continued government backing are expected to increase the share to 60% in 2025 and 80% by 2030.

Thailand is also advancing in this area, with EVs accounting for 13% of total car sales in 2024. Policy initiatives, including tax breaks and support for local manufacturing, have been central to this growth.

Vietnam is emerging as another important player, with government policies encouraging investment in electrification and supporting infrastructure development.

Fleet Electrification in emerging Asian markets

Fleet electrification is a key driver of growth in Asia, particularly in logistics, public transport, and corporate fleets. The global fleet electrification market, valued at US$ 93.25 billion in 2024, is projected to expand at a compound annual growth rate (CAGR) of 9.2% to US$ 224.51 billion by 2034.

Cost efficiency and lower operating expenses compared with internal combustion engine vehicles are encouraging this transition.

Infrastructure development is also a priority. Grid modernisation and Internet of Things (IoT)-enabled charging technologies are gaining attention as adoption scales. Regional projects, supported by both governments and private companies, are accelerating the deployment of charging networks.

Investment opportunities in Asia, 2025-2026

Automakers are aligning strategies with demand in Asian markets. Toyota is planning new battery-electric models, while Chinese manufacturers are expanding their presence in Southeast Asia through competitive platforms and cost structures.

Battery technology remains an important area of focus. The transition from lithium-ion to semi-solid-state and solid-state batteries is expected to improve energy density and safety, with early adoption likely by 2026.

Charging infrastructure also presents significant opportunities, with the global EV charging market projected to grow from US$ 16.43 billion in 2023 to US$ 257.03 billion by 2032, reflecting a CAGR of 35.6%.

China's dominance in the EV supply chain, combined with its 75% share of emerging market sales growth in 2024, makes it a central player. Southeast Asia, particularly Thailand and Vietnam, supported by expanding manufacturing capacity and government electrification targets, represents another key growth region.

Conclusion

The growth of Asia's EV market is being shaped by policy support, fleet electrification, and infrastructure expansion. While challenges such as grid capacity and cybersecurity risks remain, the trajectory indicates a steady transition towards wider EV adoption.