Asia’s weirdest car market: People aren’t ready for electric cars – unless they’re made in China

Tram Ho

When Wimonsiri Boonyopakorn’s husband moved to Bangkok for work, the 35-year-old teacher decided to buy a car so she could make the 257km trip to visit him on the weekend. She was surprised to see that some electric vehicles from Chinese manufacturers cost less than gasoline-powered cars of similar size.

Currently, the Thai electric vehicle market is considered a strange market in the global car industry. But it points to a number of trends that analysts say are worrisome for automakers.

With government subsidies, Chinese electric vehicles are emerging as price leaders in Southeast Asian countries, where Japanese companies such as Toyota and Isuzu have long controlled most of the auto market.

For more than a decade, China has advocated for the production of smaller, affordable electric vehicles, whose most expensive component is the battery. By 2022, China will account for more than half of all electric vehicles sold globally.

Thị trường xe kì lạ nhất châu Á: Người dân chưa sẵn sàng cho xe điện – chỉ trừ khi chúng được sản xuất tại Trung Quốc - Ảnh 1.

In Korat, a regional center of Thailand northeast of Bangkok, the new black paint and large windows of the newly built Great Wall Motor dealership stand out against a stretch of highway and the showrooms look like older offers Nissans and Fords.

Mr. Hirotaka Uchida, head of Southeast Asia auto business at management consulting firm Arthur D. Little, said: “Thailand and other emerging countries in Asia have different requirements for with electric cars compared to the US”. Chinese manufacturers are showing that they can meet demand for affordability, he said.

As the Chinese carmaker finds it hard to develop a large presence in the US, some analysts say its dominance in electric vehicle sales in Southeast Asia could be the premise for a future. battle for market share in Europe, the second largest electric vehicle market after China.

In a November report, Fitch Solutions said the weakening economy could prompt some consumers in developed countries to seek options from China. The market research firm says Chinese brands could double their expansion efforts in Europe by 2023 and capture up to 15% of the continent’s electric vehicle battery market by 2025, from around 5 % by 2022. Some Chinese brands are also looking to sell higher-end models in Europe.

In Thailand, according to the Ministry of Energy, 13,298 electric vehicles were sold in the first nine months of 2022, up from 1,954 vehicles in 2021. Bangkok-based Kasikorn Research Center estimates that Chinese manufacturers account for about 80% of those electric vehicle sales.

Thị trường xe kì lạ nhất châu Á: Người dân chưa sẵn sàng cho xe điện – chỉ trừ khi chúng được sản xuất tại Trung Quốc - Ảnh 2.

Photo: Reuters

Price factor

Price made the difference. The electric Toyota bZ4X retails for around $53,000 in Thailand while Tesla recently started selling cars in the country and its Model 3 starts at around $51,000 — more than double that number. money that Mrs. Boonyopakorn paid for her new car.

Boonyopakorn’s vehicle of choice is an electric car called Ora Good Cat from China’s Great Wall Motor. She spent 763,000 baht, or about $22,000, with about $4,000 in government subsidies. That makes it cheaper than a gasoline-powered Toyota Corolla or Honda Civic.

In Indonesia, SAIC-GM-Wuling’s electric hatchback Air was introduced last summer and became the best-selling electric vehicle in the country in the third quarter with a price equivalent of about $15,000.

Currently, China’s share of the Thai market in general is still relatively small. According to Arthur D. Little, Japanese brands mainly offer gasoline-powered cars and gasoline-electric hybrids account for about 80% to 90% of total vehicle sales.

Siriwan Boonvisuit, manager of a Toyota dealership in the central province of Saraburi, said charging infrastructure is still limited and about 60 percent of vehicles are pickup trucks. Agriculture is a major industry in the province, she said, and people often use truck beds to transport goods such as durians and sugarcane.

“The interest in electric vehicles is trending in big cities,” said Ms. Boonvisuit. In Saraburi, Chinese automakers do not cause a sense of price crisis in the current difficult economic situation,” she said.

The race to expand market share is still in the early stages. Great Wall opened an auto factory in Rayong, Thailand in June 2021, initially producing hybrid vehicles. In September, the company said it wanted the Rayong factory to become a global manufacturing and export base.

China’s leading electric vehicle maker BYD said in September that it planned to open its first fully-owned passenger car factory outside of China, also in Rayong. The plant will open in 2024 with an annual production capacity of 150,000 electric vehicles that will be sold mainly in Southeast Asia and Europe.

Thị trường xe kì lạ nhất châu Á: Người dân chưa sẵn sàng cho xe điện – chỉ trừ khi chúng được sản xuất tại Trung Quốc - Ảnh 3.


The Mercator Institute for China Studies, a German think tank, has advocated for Europe to use trade measures to prevent its market from being overrun by cheap Chinese electric cars.

“China’s industrial policies give the country an advantage. Cars have long been a major European export to China and elsewhere. However, Chinese-made electric vehicles could make auto trade between China and the EU difficult,” the report said.

According to WSJ

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Source : Genk