BYD, the Chinese new energy vehicle manufacturer and second largest manufacturer by sales globally, and BMW, the renowned German luxury car brand, have both decided to establish manufacturing bases in Thailand for electric vehicles (EVs) and batteries. Despite their very different journeys, their decision to set up operations in Thailand alongside a multitude of other EV car and battery manufacturers highlights the country's growing appeal as a manufacturing hub for the industry.
Thailand’s government has implemented a range of incentives, including tax breaks and subsidies, to attract EV manufacturers. These policies have positioned the country as a key player in the production of battery electric vehicles (BEVs) and hybrid technologies, significantly contributing to the zero-emission transition.
The country has an ambitious "30@30" goal which aims for 30% of vehicles manufactured by 2030 to be EVs. With more than half of its 2.5 million vehicle production capacity designated for export, Thailand is poised to play a crucial role in global clean energy vehicle production.
BYD inaugurated its first EV factory outside China in Rayong, Thailand, in July 2024. This state-of-the-art facility, valued at $900 million, will have an annual production capacity of 150,000 vehicles. The factory is part of a broader expansion strategy targeting the Association of Southeast Asian Nations (ASEAN), Australia, and Europe.
BMW has been manufacturing cars in Thailand since 2000, but now has plans to roll out its first Thai-made EVs in the latter half of 2025 coming on the heels of its new high-voltage battery plant opening in Rayong in March 2024.
Several other Chinese automakers, including Great Wall Motor, Hozon New Energy Automobile, SAIC Motor, Chongqing Changan Automobile, GAC Aion, and Chery Automobile, are also investing in manufacturing facilities. Japan's Isuzu Motors, which controls 50% of the Thai pickup market, plans to produce its first BEV in Thailand and export it to Europe by 2025. Additionally, Toyota, Honda, and Korea's Hyundai Motor Company have announced significant investments in EV and battery production. Mercedes-Benz has also been assembling electric cars and batteries in the country since 2022.
The establishment of a localized supply chain is critical for Thailand's continued EV sector growth. Chinese battery manufacturer SVOLT Energy Technology, in partnership with Thai energy company Banpu Next, began producing EV battery packs in early 2024. Changan also announced significant partnerships with Thai-based parts manufacturers to support its EV production starting in 2025.
According to Eric Ruge, Managing Director of BMW Manufacturing (Thailand) Co. Ltd., the market's rapid development has been surprising even for industry experts. In 2023, EV sales in Thailand surged nearly eight-fold to 76,000 units, representing 12% of all vehicles sold. The market share increased to 14% in the first quarter of 2024, positioning the country as a leading EV market in Southeast Asia.
Thailand's strategic government policies and robust incentives have attracted significant investment from global automakers, positioning the country as a pivotal player in the global EV market. The Board of Investment (BOI) says across 18 clean energy automakers, they've seen an injection of over $2 billion, with that number expected to soar by 10-fold within the next three years.
