Chinese Enterprises Assist Thailand in Green Travel

Thailand is a Southeast Asian automobile manufacturing center and the tenth largest automobile producing country in the world. With the global emphasis on sustainable development and environmental protection, the automotive industry is undergoing a profound transformation. Thailand has seized this opportunity, planned ahead and strongly supported the new energy vehicle industry. As early as 2016, the Thai government proposed the "Electric Vehicle Strategy" aimed at promoting the production and use of electric vehicles.

In this context, a group of Chinese new energy vehicle companies have turned their attention to Thailand, not only exporting new energy vehicles to Thailand, but also accelerating local investment and factory construction. Chinese new energy vehicle manufacturers have launched right-hand drive models, updated local versions in Thailand, and accelerated local production. Chinese car brands have implemented a strategy to accelerate their entry into Thailand and radiate the Southeast Asian market, helping Thailand become the most active electric vehicle market in Southeast Asia and striving to become the "electric vehicle manufacturing center" in the region.

Transformation and upgrading of traditional automotive industry

The Thai government has long attached great importance to the development of the automotive industry, viewing it as an important pillar of the national economy. At present, the automotive industry contributes 11% to Thailand's Gross Domestic Product (GDP) and provides employment opportunities for over 750000 people. With the rapid development of global green industries, the Thai government is actively formulating policies to promote the popularization of new energy vehicles. In order to reduce greenhouse gas emissions and further promote the development of sustainable transportation, according to the Thai government's plan, by 2030, new energy vehicles should reach 30% of the national car sales.

To this end, the Thai government has introduced a series of stimulus policies, such as reducing tariffs on electric vehicles, providing car purchase subsidies, and lowering vehicle registration taxes, to encourage consumers to purchase new energy vehicles. At the same time, the government is vigorously building charging infrastructure nationwide to solve problems such as difficulty in charging electric vehicles. In addition, the Thai government has collaborated with enterprises to launch a national electric vehicle plan, vigorously supporting local car manufacturers in developing new energy vehicles and related technologies, especially the key battery technology for electric vehicles. In order to increase public recognition of electric vehicles, the Thai government also focuses on promoting the concept of green transportation, encouraging the development of electric taxis and buses, and promoting a more low-carbon and environmentally friendly public transportation system.

A series of government measures have led to an increasing number of Thai people choosing electric vehicles as an important option. In 2023, the sales of electric vehicles in Thailand will account for 9% of the total domestic car sales, and it is expected that this number will double by the end of 2024. In the first five months of this year, the number of new registrations of electric vehicles in Thailand increased by 31.64% compared to the same period last year, becoming a highlight of the reverse growth in the sluggish Thai automotive industry. A young man working in Bangkok, Alaf, said he is considering replacing his existing fuel powered cars with new energy vehicles to reduce monthly fuel costs of up to 4000 Thai baht to 5000 Thai baht. Several Chinese car companies in Thailand have stated that Thai consumers prioritize price and practicality when replacing their electric vehicles. Chinese car companies' products are increasingly favored by Thai consumers due to their modern appearance, convenient operating systems, and competitive prices.

Rapid layout of Chinese enterprises

In recent years, with the rise of new energy vehicles, especially in China, the automotive market landscape in Thailand is quietly changing. In 2022, Japanese car brands accounted for as much as 86% of new car sales in Thailand, but by 2023, this number has dropped to 75%. At the same time, the market share of Chinese car brands in the Thai market has surged from about 5% in 2022 to about 11% in 2023, especially in the new energy vehicle market, where Chinese companies have a market share of up to 80%.

During this process, BYD, one of China's leading players in new energy vehicles, performed remarkably well. BYD has been the best-selling pure electric vehicle in Thailand for 18 months since January 2023. Nowadays, for every 3 pure electric vehicles sold in Thailand, 1 is BYD, and its market share is as high as 41% of the Thai electric vehicle market. In July 2024, BYD completed the construction of its first electric vehicle factory in Southeast Asia in Thailand, with an annual production capacity of 150000 vehicles, marking BYD's continuous deepening of its layout in the Thai market. BYD Chairman Wang Chuanfu stated that Thailand's new energy vehicles are expected to enter a golden period of development, and BYD plans to further promote localized research and development, enrich product lines, and meet consumer needs.

In addition, Chinese new energy vehicle companies such as Great Wall Motors and SAIC are actively targeting the Thai market. According to statistics, currently seven Chinese electric vehicle manufacturers have set up car assembly plants in Thailand, with a total investment of nearly 70 billion Thai baht. At the same time, Chinese companies are actively expanding their production of core components for electric vehicles, and companies such as CATL have begun seeking investment in building battery factories in Thailand. Thai major component manufacturer Vertex Group stated that after Chinese new energy vehicle companies enter Thailand in large numbers, local component manufacturers in Thailand must urgently improve production efficiency to meet the expanding production scale of Chinese car companies in Thailand.

Regarding this, Lin Chuqin, Chairman of the Thai Chinese Chamber of Commerce, stated that Chinese new energy vehicles have gradually become the first choice for Thai consumers. The cooperation between Thailand and China in the field of new energy vehicles will provide a new demonstration role for the two countries' cooperation in new quality and productivity.

Collaborate to create a green future together

Against the backdrop of jointly building a China Thailand community with a shared future, cooperation between China and Thailand is constantly deepening and becoming more practical. Cooperation in the field of new energy has become one of the highlights of the construction of the China Thailand community with a shared future.

To this end, Thai Minister of Industry Pingpara emphasized that the Thai government attaches great importance to the development of the new energy vehicle industry and is committed to building Thailand into a global manufacturing center for the automotive industry. The Thai government is actively promoting the transformation and upgrading of the automotive industry, welcoming investment from Chinese new energy vehicle companies and other new quality productivity enterprises, supporting the establishment of a supply chain for the China Thailand new energy vehicle industry, and looking forward to strengthening cooperation between Thai enterprises and Chinese new energy vehicle companies. Wei Lun, director of Thailand China "the Belt and Road" Research Center, said that the high-quality cooperation between China and Thailand in the new energy vehicle industry is an example of Chinese path to modernization benefiting the "global South".

The achievements of Chinese path to modernization are constantly benefiting neighboring countries. The "the Belt and Road" initiative and the "East Thailand Economic Corridor Strategy" are deeply linked and complementary. China Thailand green cooperation has injected new momentum into the joint efforts of the two countries to build new quality productivity, and also provided new valuable opportunities for the development of more ASEAN countries. (Cui Weiyi, Economic Daily reporter)