Thailand has become a battleground for global car manufacturers, with Chinese automakers such as BYD, GAC Aion, and Chery making significant inroads. These companies are expanding in Thailand not only to meet local demand but also to capitalize on the country’s role as a regional manufacturing hub. In fact, the country has become one of the focal points of the competition for auto-market supremacy, especially in the electric vehicle (EV) sector.
Over the past two years, Chinese EV manufacturers have poured investments into Thailand, with BYD and GAC Aion’s factories already operational as of July. By the end of the year, Chinese investments in local auto plants will total at least $1.4 billion. These plants are expected to ramp up production and, when fully operational, could produce at least 320,000 vehicles annually.
The Thai government has been keen to maintain its position as the “Detroit of Southeast Asia.” A central part of this effort is the goal to have 30% of all vehicles produced in the country be EVs by 2030. As part of this strategy, Thailand has offered substantial incentives to promote the adoption of EVs and is positioning itself as a regional manufacturing hub for electric cars. In 2023, Thailand registered over 76,000 battery electric vehicles (BEVs), a 6.5-fold increase from the previous year, although growth slowed in 2024. Chinese EV manufacturers are contributing to this surge in demand, and their presence is becoming more visible with showrooms and billboards now widespread in major cities like Bangkok.
Chinese car companies are expanding aggressively into middle-income markets like Thailand, Indonesia, Brazil, and Malaysia, where the competition is less intense compared to more developed markets like Europe and North America. The Thai government’s favorable trade policies, such as low export duties within the ASEAN region and incentives to keep manufacturing local, further add to Thailand’s attractiveness for these automakers. China’s relatively friendly relationship with Thailand also plays a role in the ease with which Chinese companies are setting up production in the country.
Narong Yuenyonghattaporn, a retired civil servant in Bangkok, is part of the growing trend of Thai consumers buying EVs from Chinese manufacturers like GAC Aion. For him, the local availability of parts and easier maintenance, thanks to these manufacturers setting up assembly plants in Thailand, reassures him about the reliability of Chinese EVs. Furthermore, Narong believes that Chinese government support for domestic EV production and the large number of vehicles being sold in China contribute to the quality of these cars.
Despite the gains made by Chinese automakers, Toyota remains the dominant player in Thailand’s auto market, retaining the top spot with 265,949 vehicles sold last year. However, Chinese brands, led by BYD, have made significant progress, accounting for 11% of the total new car market share in Thailand—more than double the previous year’s share. Notably, Chinese brands captured about 80% of Thailand’s EV sales in 2023.
While Chinese EVs are gaining ground, challenges remain. For instance, the issue of charging infrastructure is still a concern, particularly in less urbanized areas like Chiang Mai. This could continue to make traditional vehicles, such as Toyota pickups, more popular in rural areas.
In summary, Thailand is rapidly becoming a key battleground in the global race for EV dominance. Chinese automakers are seizing the opportunity to establish a foothold in the country, leveraging favorable government policies and the growing demand for EVs. While challenges persist, including concerns about charging infrastructure and strong competition from Japanese automakers, the rise of Chinese EVs in Thailand marks a significant shift in the Southeast Asian auto market.
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