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Chinese automakers dominate booming Thai EV market

Written by Nikkei Asia Published on   3 mins read

Government pushes PTT-Foxconn joint venture to roll out cars within year.

Chinese automakers have grabbed a big slice of Thailand’s rapidly growing electric vehicle market, thanks to government subsidies that have lowered prices for buyers and jacked up sales more than fourfold this year.

China’s Great Wall Motor is the best known EV brand in Thailand. The company has sold more than 2,000 cars to Thai drivers since entering the market a year ago. This year more than 3,000 people are waiting to take delivery of Great Wall EVs.

In addition, 500 limited-edition Ora Good Cat cars, the company’s entire stock, sold out in 58 minutes when the model was launched last week, highlighting the strong demand for EVs.

Another popular Chinese make among Thai drivers is Shanghai-based SAIC Motor, which owns the MG brand. SAIC sold more than 4,500 EVs in the country last year, and its sales are expected to rise further this year, analysts say.

The Federation of Thai Industries forecasts sales of EVs in the Thai market at more than 10,000 cars this year, more than quadrupling the 1,954 cars sold in 2021, due largely to government subsidies that have made EVs more affordable. The subsidies are aimed at stimulating demand for green autos and encouraging automakers to produce them locally. The government wants electric cars to make up 30% of Thailand’s auto production by 2030.

To reach that target, the government offer buyers payments of up to THB 150,000 (USD 4,240) per EV. And on June 9, the government lowered the tax on electric cars from 8% to 2% in exchange for promises from manufacturers to build them domestically in the future.

The ASEAN-China free trade pact, which has been in effect since 2005, lets China ship EVs to Thailand tariff-free, giving a further advantage to Chinese brands.

“Japanese brands and other brands from Europe have been trying to penetrate the Thai market, but are not very aggressive, compared with Chinese brands,” FTI Vice Chairman Surapong Paisitpatanapong told Nikkei Asia.

“I think Japanese brands still enjoy rising sales of hybrid EVs, and they could wait until demand rises substantially before they start producing pure EVs,” Surapong said.

With a proactive market plan and competitive prices, the market share of Chinese EV makers in Thailand is expected to rise from 58% last year to around 80% this year, according to the Kasikorn Research Center, which also forecasts total sales of more than 10,000 EVs in the country this year.

Kasikorn puts the market share of European EVs next year at 14%, with Japanese brands splitting 5% between them and other brands accounting for around 1%. This stands in contrast to the market for gasoline cars, where Japanese carmakers Toyota, Honda, Mazda, Mitsubishi, and Nissan are the top five makes, with a combined market share of 82%.

With Chinese manufacturers’ market share growing strongly, Thai Prime Minister Prayuth Chan-ocha said last week it was time for Thailand to capitalize on rising demand by revving up its own plan to start producing EVs within a year, moving up the previous target from 2024.

Thailand has had a goal to become an EV assembler since mid-2021, when the country’s oil and gas conglomerate PTT Group teamed up with Taiwanese contract manufacturer Foxconn, aiming to start turning out EVs in 2024.

“2024 might be too late. We need to start producing our own EVs within a year from now,” Chan-ocha said during a visit of top Foxconn executives last week.

PTT CEO Auttapol Rerkpiboon said a new joint venture, Horizon Plus, has started construction on an EV plant that will serve as a contract manufacturer of EVs for other carmakers in Thailand and elsewhere in Southeast Asia.

This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.


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