Asia School of Business

Global Inquiry, Local Heart

Shrinking the National Fuel Tank: Understanding Structural Limits to Malaysia’s EV Transition

Authors: Khairina Ibrahim, Rasyid Juhari & Daniella Jamel

This policy brief examines the complex relationship between Malaysia’s electric vehicle (EV) transition, fuel subsidy consumption and vehicle ownership, revealing strong structural dependencies and constraints. As Malaysia spends billions of ringgit shielding the public from global oil price volatility, a cost that has surged since the closure of the Hormuz Strait in 2026, EVs are framed as a ‘silver bullet’ to reduce this fiscal burden. However, this brief argues that shrinking the national fuel tank is conditional on addressing the deeper roots of car dependency itself.