With demand for EV production driving the trend, Chinese companies are boosting their investment in Thailand. Despite the political unrest, Chinese electric vehicle manufacturers are flooding Thailand, according to the chairman of the Thai-Chinese Chamber of Commerce, who spoke at a seminar on Sunday in Bangkok.
Thailand as a center for manufacturing and distribution
In the upcoming EV push, more and more significant Chinese EV businesses are focusing on Thailand because they believe that any Thai government will always pursue luring international investors. Reporters were given this information by the chamber’s chairman, Narongsak Puttapornmongkol, at the 16th World Chinese Entrepreneur Convention (WCEC).
More than 4000 entrepreneurs of Chinese heritage from more than 50 countries attended the three-day convention, which closed on Monday. Given that the majority of them intend to travel within Thailand, Narongsak predicted that at least 500 million baht would be in circulation there.
The pro-royalist military establishment in Thailand was soundly defeated by opposition parties on May 14, although the new government has not yet been created. Anxiety is being stoked among the public and business sector to some extent by political instability.
“The most dynamic sector”
Hozon New Energy Automobile Co. of China, which has been operating in Thailand since March, has set a goal of selling 15,000 electric vehicles (EVs) there by the year 2023, which will make up half of its international revenue. Currently, the electric car business is the most promising. Thailand has created several customized investment incentives for EV investors because it seeks new energy sectors. China is currently making a point.At a sub-forum of the event, Hozon Auto New Energy Co. Chairman Fang Yunzhou declared, “We will establish our own parts and accessory factory and have internal research and development on key parts.”
Neta, a division of Hozon Auto, began erecting its first factory outside of China. The Bangkok facility will start operations in January 2024. The new facility will take the lead role for Neta in producing and selling right-hand drive electric vehicles to ASEAN nations.
Chinese EV manufacturers compete on the inside of the vehicle. According to Fang, Neta includes important technologies including self-driving, smart control, smart cabin, and internet of vehicles.
a setting that is stable and welcoming to Chinese businesses
Chinese businesses move to Thailand because it offers a low-risk, secure, and welcoming environment with affordable and advanced industrial capabilities. Founder and CEO of Strategy 613, Joe Horn-Phathanothai, stated in a separate interview.
“Technology transfer, for instance, has enabled Chinese investment in Thailand to give Thailand a new dimension that did not previously exist. The most recent was a tokamak nuclear fusion reactor given to Thai scientists by China.
Joe Horn-Phathanothai, CEO and founder of Strategy613, has set a 2030 target of 30% of EV production.
The East Economic Corridor Policy Committee in Thailand received a letter of investment commitment from GAC AION in April. As its first international location, the Chinese EV manufacturer is interested in the second economy in Southeast Asia. Also disclosed by Chang’an Auto was a 9.8 billion baht investment in a Thai factory to build 100,000 electric vehicles yearly.
By 2030, the Thai government hopes that manufacture of electric vehicles will account for around 30% of all car production. According to surveys, Thailand saw a sharp increase in EV sales from fewer than 2000 units in 2021 to around 10,000 units in 2022. In 2023, it’s anticipated that sales would double.
The supply chain is now a front in the EV war. Chinese battery manufacturer Gotion High-tech Co. announced last December that it would form a joint venture with Thailand’s PTT group to construct a factory producing lithium-ion batteries for electric cars.
The world’s largest EV battery manufacturer, CATL, based in China, as well as other companies are in discussions with Thai officials to develop production facilities in Thailand to support its ambitions to become an EV production hub.
Japan remained the largest foreign direct investor in the first five months, despite the fact that investment from China, as highlighted by EV, has been stimulated recently as a result of Thai government incentives on new energy industries.
According to data from the Board of Investment, Thailand received a total of 45.392 billion baht in foreign investment from January to May 2023, with the largest amount, 15.873 billion baht, coming from Japan. With 11.479 billion baht and 6.356 billion baht, respectively, China and Singapore came in second and third.
The first WCEC was held in 1991, and the most current one, which preceded a pandemic break, was held in London in 2019. The event was first held in Thailand in 1995, and it will return this year.
According to Narongsuk, the meeting’s focus is on promoting trade and investment for win-win alliances that will assist Thailand’s economy rebound rapidly from the COVID outbreak.
Overall, it appears that the Thai government’s incentives for the new energy sector have been successful in attracting investment from China and other nations. It is unclear whether Thailand will meet its target of producing 30% of all vehicles by EVs by 2030. Nevertheless, in the upcoming years, it will certainly be interesting to monitor the growth of the EV industry in Thailand.
