SMM

As a key automotive manufacturing and consumer market in Southeast Asia, Thailand has actively promoted the development of its EV industry in recent years by formulating a series of industrial development plans, aiming to secure a position in the global EV transformation wave.

In 2021, the Thai government introduced the "30·30 Policy," targeting zero-emission vehicles (ZEVs) to account for 30% of the country's total automotive production by 2030.

By the end of 2024, the number of public EV charging stations in Thailand had grown to approximately 3,429, establishing a preliminary charging infrastructure network covering major regions nationwide, providing strong support for EV adoption.

Against this backdrop, the SMM 2nd Southeast Asia Automotive Supply Chain Conference, hosted by SMM, will be held in Bangkok from June 16 to 17, 2025. Industry leaders are invited to jointly explore these challenges and opportunities and collaborate to drive the prosperity and development of the Southeast Asian and global automotive industries.

Scan the QR code for conference details.

1. Why Thailand?

Policy Incentives and Market Potential

The Thai government has rolled out the "30·30 Policy" (30% ZEVs by 2030) and EV3.5 incentives (subsidies, tariff reductions, etc., from 2024 to 2027), offering tax benefits and subsidies to Chinese automakers, such as up to 100,000 baht (approx. 20,000 yuan) per EV. Thailand's NEV penetration rate is expected to reach 12% in 2025, surpassing the 10% tipping point and entering a phase of explosive growth, indicating vast market potential.

Supply Chain and Geographic Advantages

Thailand boasts Southeast Asia's most mature automotive supply chain, with over 700 parts suppliers and 500,000 employees, earning it the nickname "Detroit of Asia," enabling automakers to quickly establish factories and reduce costs.

Its strategic location connects ASEAN markets, and under the RCEP agreement, it provides tariff-free access to a region of 660 million people, including exports to Australia and the Middle East.

Opportunities Amid Japanese Dominance

Japanese brands have long held over 70% of Thailand's market share but lag in electrification, creating an opening for Chinese automakers. By 2024, Japanese brands' share had dropped to 78%, while Chinese brands rose from 5% to 11%.

2. Core Advantages of Chinese Automakers

EV Technology Leadership and Cost Advantages

Chinese NEVs outperform Japanese ICE vehicles in battery technology, smart features (e.g., discharge function), and driving range. Models like BYD Dolphin and GAC Aion are favored by Thai consumers for their affordability and functionality.

Rapid Localization Capabilities

Chinese automakers are accelerating local production in Thailand, such as BYD (annual capacity: 150,000 units), GAC Aion (50,000 units), and Great Wall (80,000 units), while committing to 40% local parts usage to meet Thailand's supply chain localization requirements.

They have introduced right-hand-drive models and adapted pickup trucks and MPVs for Southeast Asian preferences. Recent trends at Thai auto shows highlight Chinese brands launching pickup truck lineups tailored to the region.

Ecosystem Integration and Brand Synergy

Chinese automakers are not only setting up production but also building charging networks (e.g., GAC plans 200 supercharging stations in Thailand by 2027), battery service centers, and mobility services (e.g., partnerships with Grab), creating a full life-cycle service ecosystem.

Through acquisitions (e.g., MG, Volvo) or local dealer collaborations, they are rapidly establishing sales and after-sales channels to address brand recognition gaps.

3. Challenges and Pathways to Surpass

Countering Japanese Automakers' Response

Japanese brands are reinforcing their market position with financial tools (zero-down-payment loans, used-car value retention strategies) and leveraging political influence to pressure Chinese automakers to raise prices. Chinese players must enhance local financial services, such as flexible loan schemes with Thai banks.

Avoiding the "Price War Trap"

Thai consumers are price-sensitive, but excessive price cuts risk triggering used-car depreciation disputes (e.g., complaints over BYD ATTO 3 price reductions). Balancing market expansion and brand value is critical. Additionally, improving product image is essential. Japanese brands have dominated Thailand for decades through sustained marketing and cultural influence, associating their products with "high quality," "innovation," and "premium." Chinese brands must overcome this bias and build a positive brand image—a long-term endeavor. Avoiding the fate of Chinese motorcycles in Thailand requires prioritizing quality over low-price competition.

Long-Term Commitment and Cultural Integration

Japanese automakers have operated in Thailand for decades, with deep rural penetration. Chinese players must focus on local talent development and cultural adaptation, such as aligning workplace practices (e.g., Thailand's "jai yen yen" ethos contrasts with China's overtime and cut-throat competition).

The competition between Chinese and Japanese automakers in Southeast Asia reflects two development models: Japanese reliance on ICE-era supply chain inertia versus Chinese advantages in EV technology and policy synergy. Thai auto shows demonstrate Chinese strengths in product, price, and ecosystem, but surpassing Japanese brands requires breakthroughs in technical standards, brand value, and localization depth. Future success hinges on deeper localization, a complete production-to-service ecosystem, and balancing price competition with brand value to transition from "substitute" to "leader." Over the next five years, Southeast Asia may serve as a "testing ground" for Chinese automotive globalization, offering lessons for entering European and US markets.

Conference Agenda