In Roi Et Province, the automotive manufacturing hub of Thailand, BYD, China's largest electric vehicle manufacturer, has built its first overseas factory. The factory covers an area equivalent to 180 football fields. About 20 miles (32 kilometers) south, a factory that was once operated by General Motors now belongs to Chinese company Great Wall Motor. Another 10 minutes' drive away, American Ford has taken over a car assembly plant that was formerly owned by Japanese manufacturer Suzuki.
All of this occurred over the past five years, reflecting the dramatic changes that the automotive industry is going through.
According to a report by The New York Times on October 16th, Japanese automobile manufacturers have dominated the Thai automotive market for decades. They entered Thailand in the 1960s, established supply chains, and turned Thailand into a ‘Oriental Detroit’.
Then, Chinese automobile manufacturers arrived.
Currently, Chinese automakers account for approximately 85% of the electric vehicle market in Thailand, compared to almost zero four years ago. Japanese automakers are struggling due to their delayed adoption of electric vehicle technology. From 2024 to 2025, Subaru and Suzuki closed their factories in Thailand, while Nissan and Honda reduced their production.
Several Thai auto parts suppliers that rely on Japanese automakers have gone bankrupt, posing a threat to a supply chain that employs about 700,000 workers.
Thailand’s National Economic and Social Development Committee Chairman Supawut Saechuay said, “All of this happened much faster than we expected.” The committee is Thailand’s central economic planning body.
He added, “We didn’t consider the issues comprehensively. The negative impact on Thailand is much more severe than we thought.”
China's Ambassador to Thailand, Zhang Jianwei, once pointed out that Sino-Thai cooperation in new energy vehicles promotes the development of Thailand's new energy vehicle industry. Both sides should strengthen policy coordination, enhance local integration, build a green system together, and propel the region's new energy vehicle industry towards a stable, resilient, and sustainable future.
Reports say that, in the eyes of some people, Thailand’s experience is a warning case, indicating that opening the door to Chinese electric vehicle manufacturers could lead to unexpected consequences. This lesson may also resonate with other countries. Although U.S. tariffs actually prevented Chinese electric vehicle brands from entering the U.S. market, President Trump seems open to welcoming Chinese electric vehicle brands to set up factories in the U.S. Although the EU has imposed additional tariffs on Chinese cars, it still struggles to curb the expansion of Chinese automobiles.
Thailand is trying to control the losses caused by this situation. Last month, Prime Minister Anuerdjitej Sawang visited Tokyo to calm Japanese automakers. A month earlier, he ordered a review of policies that were deemed to put these companies at a disadvantage.
In Thailand, few people believe that high fuel consumption vehicles represent the future. In the first seven months of 2026, electric vehicles accounted for one-third of new car sales. The appeal of Chinese cars to consumers is evident: many models are inexpensive, but they come equipped with large display screens and autonomous driving technology.
In the first seven months of this year, about two-thirds of electric vehicles sold in Thailand were imported, with the majority coming from China.
The Thai government is trying to curb the influx of imported cars. Last month, the government introduced a three-tier tax system, imposing the highest tax rates on car manufacturers that import cars but have no plans to produce locally, while applying the lowest tax rates to manufacturers who purchase a large number of local components.
However, Ruth Banomiyan, a professor of supply chain management at Thammasat University in Thailand, said there is little evidence to show that Thailand has benefited from this situation. She pointed out that Chinese car manufacturers operate within a 'closed ecosystem', and since the core technologies are still in China, it is difficult for Thai companies to get access to their supply chains.
In mid-August this year, the Chinese Embassy in Thailand issued a “Reminder on Chinese Enterprises and Citizens Investing and Doing Business in Thailand”. It mentioned strengthening cooperation with Thai partners in areas such as industrial support, technology research and development, talent training, and market development, practicing the principle of “acting for Thailand’s benefit”. Emphasizing participation in public welfare activities and community development, actively recruiting and training Thai employees, improving the level of local employment and talent cultivation, and promoting technology exchanges and the transformation of achievements.
When asked about the proportion of auto parts sourced from China, Benson Ke, the general manager of BYD in Thailand, said that there are too many types of auto parts, “it’s difficult to explain in detail”.
He stated that BYD purchases steel plates locally and assembles batteries with Thai partners. He mentioned that the factory employs 5,600 workers, 94% of whom are Thais. In related inspections, the level of ‘real local production’ was highly praised.
Reports suggest that there are signs everywhere of close ties between BYD and China’s supply chain. BYD uses KUKA robots, a company once owned by German capital, now controlled by China’s Midea Group. Boxes containing wiring components bear Chinese addresses, and battery cells are also imported from China.
But for Thai consumers, these may not be important.
The permanent car review blogger from Bangkok, Nitit Tuanapatong, has 1.2 million subscribers on YouTube. He says Thai viewers often ask him to review Chinese electric vehicles. These models are equipped with features such as adaptive cruise control and 360-degree panoramic imaging, and their prices are often lower than those of Japanese competitors.
Niti said: "The era when Japanese car manufacturers could easily make money in Thailand for 60 years is over. Now, they must adapt to real competition."
