With Chinese help, Thailand aims to become production hub

To achieve the Thai government's goal of building the country into the electric vehicle hub of Southeast Asia, the kingdom is welcoming Chinese EV manufacturers and their innovative technologies to integrate with local industrial chains.

Thailand has set a target of making 30 percent of its car production EVs by 2030.

"We welcome Chinese companies with new quality productive forces to set up their factories and even regional headquarters in Thailand. In return, Thailand will release more incentive measures to support their development," said Thailand's minister of industry, Pimphattra Wichaikul.

Speaking at a recent forum, Pimphattra noted the important role the EV industry will play in the country achieving its sustainable development goals. "This will not only benefit us, but also future generations," she said.

As countries are becoming more aware of the impact of climate change, EVs have become more important for them to achieve their green development goals.

In February, Thai Prime Minister Srettha Thavisin unveiled his "Thailand Vision "at Government House, which laid out ambitious plans for making the country a hub for tourism, medical services, food, aviation, logistics, electric vehicles, the digital economy, and finance.

Srettha said his government aimed to turn Thailand into a future mobility hub with a goal of drawing over 1 trillion baht ($28.67 billion) in foreign investment. "Thailand used to be called the Detroit of Asia. Now, the auto industry is transforming into the EV industry so Thailand will become a hub of future mobility," Srettha said.

The government also outlined three major measures — developing skilled workers, increasing EV usage, and supporting research and development — to build Thailand into the biggest EV production hub in Southeast Asia.

Last year, about 76,000 EVs were sold in Thailand, with about 80 percent of them Chinese models, according to Thai authorities.

Many Chinese automakers, including MG, Great Wall Motor, NETA, Changan and GAC Aion, have chosen the kingdom as their primary production base in the region.

According to The Board of Investment of Thailand, most Chinese EV makers have agreed to the government's request to use auto parts made by Thai companies. Great Wall Motor, for instance, wants to source 80 to 90 percent of its EV components from local materials.

Chongqing-based Changan Automobile, which has committed to investing up to 10 billion baht in Thailand, will start with a local content proportion of 60 percent, increasing it to 90 percent in the future, the Bangkok Post reported.

"Chinese EV enterprises are bringing production lines to Thailand, which not only enhances local employment, but also meets the requirement of our own target of transforming some eastern provinces into a new corridor of innovation and economic growth," said Kanate Wangpaichitr, assistant secretary general of the Eastern Economic Corridor, an economic promotion zone.

The EEC lies at the heart of Thailand's 20-year strategy to achieve high-income status by 2036 through a range of top-down initiatives

"Collaboration between Thailand and China on high-quality EV production is a reflection of China's modernization and its benefits to the Global South," said Wirun Phichaiwongphakdee, director of the Thailand-China Research Center of the Belt and Road Initiative.

He said China's high-quality development and high-level opening-up provide great opportunities for Southeast Asian countries to accelerate industrial upgrades and reforms through joint efforts with China.

"For example, the Guangdong-Hong Kong-Macao Greater Bay Area and EEC — two areas that enjoy close proximity — can make their respective advantages complementary to each other. Such collaboration will bring win-win results to both sides and benefit its people," he added.