Thailand’s supercharged EV sales poised for a new surge

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BYD and BMW are two very different auto companies. The former is the Chinese upstart that is tussling with Tesla for the title of world's leading manufacturer of new energy vehicles, the latter is the venerable 108 year old German company which ranks as the global top selling luxury car brand.

Yet despite their dissimilar pedigrees and target markets, BYD and BMW have made one identical business decision: to make Thailand a base to manufacture electric vehicles and the increasingly sophisticated batteries that power them.

They are far from alone. Thai government tax breaks, subsidies and other incentives are transforming south east Asia's second largest economy into a global hub for the production of battery electric vehicles (BEVs) and the hybrid technology which is supporting the zero-emission transition.

Even as BYD staged the grand opening on 4 July, 2024 of its THB32bn (US$900m) factory at Rayong in Thailand's high-tech eastern economic corridor, six other major Chinese BEV manufacturers - Great Wall Motor, Hozon New Energy Automobile, SAIC Motor, Chongqing Changan Automobile, GAC Aion and Chery Automobile - were already either operating or building their own factories nearby.

In addition to this Chinese investment surge, Japan's Isuzu Motors in March used the Bangkok International Motor Show to unveil the company's first BEV – a version of the best-selling D-Max one-ton pickup truck – which it said would be built in Thailand and exported to some European markets, such as Norway, starting in 2025. Isuzu, which boasts 50 percent of the Thai pickup market, has filed last year with the Thailand Board of Investment (BOI) a plan to increase its investment in Thailand by THB32bn.

Isuzu's compatriots, Toyota and Honda, are also embracing the kingdom as a place to advance their own clean energy ambitions by initially focusing on hybrids while taking tentative steps towards EV production.

So, too, is Korea's Hyundai Motor Company. Its unit, Hyundai Mobility Manufacturing (Thailand) received approval from the BOI in August 2024 to invest THB1bn to start in 2026 the local assembly of BEVs and the batteries that power them.

Of the major European investors, Mercedes-Benz has been assembling electric cars and batteries in Thailand since 2022. BMW, which leads the premium market segment and has been building cars in Thailand since 2000, will launch its first locally made EVs in the second half of 2025. In March 2024, it broke ground on a EUR42m fifth generation high voltage battery plant in Rayong.