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Latest Report: In-Depth Survey of the Southeast Asian Automotive Market
Apr 16, 2025, at 3:00 pm
Against the backdrop of global automotive industry transformation and geopolitical tensions, Chinese automakers have embarked on a journey to go global, leveraging their complete supply chains, economies of scale, and cost advantages. This journey is driven by industry transformation and supported by relevant policies. Let's delve into the background and related policies of Chinese automakers' global expansion.
**China's Favorable Policies**
- In December 2019, the Ministry of Commerce released the "Report on High-Quality Development of China's Automotive Trade," which for the first time proposed that NEVs could become a new momentum for automotive exports.
- In 2023, China's NEVs entered the fast lane of overseas markets, with various levels of government introducing a series of policies to encourage and promote the export of Chinese NEVs.
- In 2023, the "Opinions on Supporting the Healthy Development of NEV Trade Cooperation" jointly issued by the Ministry of Commerce and seven other departments is the most comprehensive and influential policy in the field of NEV global expansion, providing all-round, multi-level support and guarantees, and encouraging the strengthening of China's NEV foreign trade cooperation.
**Enhance International Operation Capabilities and Levels**
**Improve International Logistics Systems**
**Strengthen Financial Support**
**Optimize Trade Promotion Activities**
**Create a Favorable Trade Environment**
**Enhance Risk Prevention Capabilities**
**Southeast Asia Policy Support**
- In 2023, Southeast Asian countries such as Thailand, Malaysia, and Indonesia successively launched electrification transformation plans and implementation roadmaps, and introduced a series of incentive policies to promote the development of NEVs. By expanding domestic demand, improving infrastructure, increasing tax exemptions or fiscal subsidies, they attracted foreign enterprises, represented by Chinese NEV-related producers, to set up factories and vigorously develop local NEV industries.
- In the short term, Thailand, Malaysia, and Indonesia will continue to introduce strong policies to accelerate cooperation with Chinese NEV-related enterprises to promote the cultivation of local EV industry chains and markets. Other Southeast Asian countries such as Vietnam and the Philippines are also preparing to transition to EVs and will introduce national development plans and related aggressive policies.
**European and US Policy Pressure**
- In recent years, European and US countries have introduced relevant policies in areas such as trade protection, trade barriers, and low-carbon management to restrict the entry of China's NEV industry chain into European and US markets, thereby suppressing the overseas development of China's NEV industry chain.
- In the long term, the overall direction of the European and US automotive electrification transformation will not change. If China can continue to maintain its leading position in NEV technology and products, the negative impact of European and US pressure on the development of China's NEV industry will be limited.
- EU
√ Trade Protection: Net-Zero Industry Act (NZIA), Critical Raw Materials Act
√ Non-Tariff Barriers: Anti-Subsidy Investigations
√ Tariff Barriers: Carbon Border Adjustment Mechanism (CBAM)
√ Low-Carbon Management: New Battery Act
- US
√ In May 2024, the Biden administration announced a 100% tariff on Chinese imported EVs.
√ In April 2025, Trump announced a 25% tariff on imported cars and trucks, effective April 3; a 25% tariff on imported auto parts, effective May 3.
Meanwhile, low automobile ownership, limited NEV penetration, and a large young population base provide automakers with a vast market space.
**How to Get the "SMM Latest Southeast Asia Automotive Market Survey Report" for Free**
1. Share this article on your WeChat Moments, accumulate 3 likes, or forward it to 1 automotive industry group chat (with more than 200 people), and save the screenshot.
2. Add the editor's WeChat and send the screenshot to get the report for free.
In recent years, the Southeast Asian automotive industry chain has shown significant resilience, with regional automotive production increasing by 24.1% from 2020 to 2022. Although it experienced a cyclical decline in 2024 due to global economic downturn, the production and sales decline in Thailand and Southeast Asia in 2025 has shown a narrowing trend, highlighting the self-repairing ability of the regional supply chain.
As a regional core hub, Thailand continues to dominate the Southeast Asian automotive industry with a capacity share of over 40%. However, the dual pressures of shrinking domestic demand and weak exports have led to a continuous YoY decline in production for 19 months—down 13.6% YoY in February 2025, significantly narrowing from the 24.6% decline in January, indicating initial signs of stabilization in the industry chain adjustment. In the short term, Thailand will maintain its status as a regional production center and export base, but its long-term competitive advantage is facing structural challenges: continuous contraction of local capacity and the upgrading of neighboring countries' industry chains are forcing it to accelerate technological transformation and supply chain restructuring.
In analyzing the strategic layout of Chinese automakers' expansion into Southeast Asia, in addition to the widely discussed factors above, the editor believes that the following elements are also important driving forces for Chinese automakers to actively deploy in the Southeast Asian market (especially Thailand), continuously deepen and expand their presence. These elements are intertwined and synergistically contribute to the vigorous development of Chinese automakers in the Southeast Asian market.
1. ASEAN countries are promoting the popularization of EVs through policies such as tax reductions, car purchase subsidies, and industry chain support.
2. The Thai government has upgraded its industrial policies, introducing stricter EV3.5 certification standards, and promoting the deep layout of the EV industry chain by increasing localization requirements.
3. In terms of complete vehicles, Thailand currently maintains its status as a net exporter of automobiles, with its complete vehicle exports mainly targeting the Southeast Asian regional market; China's exports to Thailand are dominated by NEVs, reflecting the strategic layout of Chinese automakers to seize the opportunity of Thailand's electrification.
4. In terms of parts:
(1) Thailand is the main force in Southeast Asia's parts exports, with target markets in the Americas and Asia.
(2) China's exports serve local Chinese OEMs, with exports to the US mainly focusing on locally advantageous products such as wheels.
The overall investment environment in Southeast Asian countries has significant favorable conditions, with many preferential policies and continuously improving infrastructure. Market demand is growing with economic development and demographic changes, showing great potential. However, the Southeast Asian market is facing urgent problems: incomplete supply chains, for example, crude steel capacity reaches 90 million mt, mainly long products, with a severe shortage of automotive steel-related capacity. At the same time, unfavorable factors such as complex political situations, policy changes, and incomplete legal and regulatory systems exist in some countries.
More importantly, tariff policies are unpredictable and targeted, posing many challenges to corporate investment decisions. In this context, the globalization of automotive companies is imminent to diversify risks, integrate resources, and enhance competitiveness. For more in-depth information on the Southeast Asian automotive market, you can scan the code to contact the editor for a free copy of the "SMM Latest Southeast Asia Automotive Market Survey Report" full version.
**How to Get the "SMM Latest Southeast Asia Automotive Market Survey Report" for Free**
1. Share this article on your WeChat Moments, accumulate 3 likes, or forward it to 1 automotive industry group chat (with more than 200 people), and save the screenshot.
2. Add the editor's WeChat and send the screenshot to get the report for free.
