Bridging Local Observation and Global Simulation in Closed-Loop Traffic Modeling

A local-to-global context mismatch arises when autoregressive traffic simulators trained on ego-centric driving logs are deployed in globally observable closed-loop environments. In such logs, the ego vehicle has rich local observations, while surrounding agents are only partially observed due to perception limits and occlusions. As a result, simulators may learn incomplete context--action mappings that remain hidden in log-based training but emerge during closed-loop rollouts, leading to unrealistic behaviors such as abnormal stops, unsafe interactions, and rule violations. We propose CRAFT, a Contextual pReference Alignment Framework for Traffic Simulation, to mitigate this mismatch via self-supervised failure discovery and preference-guided test-time alignment. CRAFT treats the base simulator as a globally observable sandbox, generating diverse what-if rollouts from logged initial states to expose context-induced failures. These failures are grounded with human-aligned driving priors and converted into preference supervision for training a Contextual Preference Evaluator (CPE). At inference time, CPE acts as a plug-in alignment module that scores candidate actions under complete scene context and reweights autoregressive decoding toward globally coherent behaviors. CRAFT mitigates this local-to-global contextual bias, reducing collisions by 31.2\% and traffic violations by 33.2\% without retraining the base simulator.