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Thailand moving full speed ahead to lure China’s EV ‘big fish’ to ‘Detroit of Asia’

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Thailand moving full speed ahead to lure China’s EV ‘big fish’ to ‘Detroit of Asia’

  • Chinese EV makers are the top target of Thailand’s goal to lure US$28 billion of foreign investments to break into the top tier of electric vehicle makers
  • Thailand recorded US$10 billion in foreign direct investment applications in the first 8 months of 2023. Chinese investors account for a quarter of the total
Published: 1:44pm, 26 Oct, 2023

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A BYD Dolphin EV car at the 44th Bangkok International Motor Show in Bangkok. Thailand is hoping to lure some of China’s largest EV car makers to the country. Photo: Reuters

Thailand, renowned as the “Detroit of Asia” for its production of internal combustion engine cars, wants to break into the top tier of electric vehicle makers as part of a goal to lure 1 trillion baht (US$28 billion) of foreign investments in four years.

To that end, the Southeast Asian nation has set up a “special operation” centre to catch what its investment board head calls the “big fish” of the EV industry and other strategic sectors. Chinese EV makers are a top target, Narit Therdsteerasukdi, secretary general of the Board of Investment, said in an interview.

The agency’s investment target for the four years through 2027 has not been previously reported.

EV and automotive, electronics, digital, so-called regional headquarters and green economy are the five “strategic industries” being prioritised by the board for investments, Narit said.

While Thailand has already attracted a slew of Chinese companies including BYD Co., Great Wall Motor Co. and SAIC Motor Corp., a look at EV investment trends in 2022 shows the urgency for the nation to get in on the action. The US, Hungary, Mexico, Indonesia and Germany cornered the bulk of the more than US$106 billion investments pledged in EV projects globally last year, according to data from greenfield investment monitor fDi Markets.

The newly-set up Bangkok-based Special Operation Center For Strategic Investment is now working almost around-the-clock to identify high-potential investors and arrange high-level meetings for the government, and accompany Prime Minister Srettha Thavisin on important overseas trips to try to lock down investment pledges.

After Srettha’s visit to the US last month, the board is also courting what Narit calls “hyperscalers,” including Microsoft Corp., Google, and Amazon Web Services, to build or increase their presence in Thailand through fresh investments.

“The next few years from now is a golden opportunity for Thailand to attract investment by tapping into the restructuring in global supply chain and relocation trends. We must seize it,” said Narit, who last week joined Srettha’s meetings with potential new investors in Beijing. “We will be intensifying our efforts from now.”

Growth target​

The BOI’s four-year foreign investment goal is in line with the government’s pledge to stimulate economic growth to about 5 per cent annually over the same period – a much-needed revival after Southeast Asia’s second-largest economy lagged most regional peers in recent years.

Thailand is hoping to lure more investments now than the 981 billion baht commitments it received between 2019 and 2022 using less than half the target industries then.

The nation has recorded 365 billion baht (US$10 billion) in foreign direct investment applications in the first eight months of this year, with Chinese investors accounting for a quarter of the total.

While Chinese investments are surging on the one hand, Japanese legacy carmakers, which made inroads into Thailand decades ago, have been pouring more money into factory expansion plans on the other, according to Narit. Still, Thailand is looking to help them shift to “clean energy” – not just fully electric cars but also hydrogen-powered models.

“The target is achievable, especially if we keep promoting EVs,” Narit said, adding that more firms in the EV supply chain, including battery makers, are expected to follow suit. “We’re aggressively seeking new players to set up shop in Thailand but that alone isn’t enough to make us number one.”

In 2022, foreign direct investment applications in the automotive sector reached almost 100 billion baht (US$2.8 billion), a 347 per cent jump from 2021. Owing largely to the EV rush, automotive saw the third most investment pouring in after electronics and machinery, accounting for about 23 per cent of the value of foreign projects that year.

Thailand is preparing incentives to keep the EV investment momentum and quell continuity concerns raised by investors, Narit said. The so-called “EV 3.5” new incentive packages are expected to be submitted to the cabinet soon now that Srettha on Wednesday appointed the country’s new EV board under his chairmanship.

“We’re not taking a single step back with EVs,” Narit said. “We’re full speed ahead.”


 
Chinese carmaker SAIC Motor opens first EV battery plant in Thailand

2023-10-31 22:05:30​


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Participants cut the ribbon during the opening ceremony of a battery shop of SAIC Motor in Chonburi, Thailand, Oct. 31, 2023. Chinese carmaker SAIC Motor on Tuesday announced the opening of its first electric vehicle (EV) battery plant in Thailand, as the first deeply localized battery rolled off the assembly line in the factory. (Xinhua/Wang Teng)

CHONBURI, Thailand, Oct. 31 (Xinhua) -- Chinese carmaker SAIC Motor on Tuesday announced the opening of its first electric vehicle (EV) battery plant in Thailand, as the first deeply localized battery rolled off the assembly line in the factory.

The EV battery plant, spanning 12 hectares, is located in New Energy Industrial Park, Chonburi province's Eastern Economic Corridor Special Zone.

With a production capacity of 50,000 units per year, the EV battery plant is divided into two main areas. The first one is the battery assembly area, which is fully automated, and the second area is designated for battery standard testing, which involves over 60 processes.

Zhao Feng, president of SAIC Motor-CP, a joint venture between SAIC Motor Corp and Charoen Pokphand Group, said they invested 500 million baht (around 13.9 million U.S. dollars) in the EV battery plant, and the plant showcases the company's vision as a pioneer and leader in electric vehicles in Thailand.

SAIC's MG brand, which entered the Thai EV market in 2019, has become one of the most popular brands among Thai customers, with more than 18,000 units sold so far in the country, Zhao said.

As the first EV battery factory launched in the country, this will reflect Thailand's potential and readiness to become a regional and global EV production base, said Nattapol Rangsitpol, permanent secretary of the Ministry of Industry.

Thailand has long been a major automobile production base in Southeast Asia due to its industrial chain and geographical advantages. Under the government's investment promotion, the country aims to produce EVs for 30 percent of all vehicles in the country by 2030.

This month, another Chinese carmaker Changan signed a land purchase agreement with Thailand's industrial estate developer WHA Group to build a new EV factory, with an initial capacity of 100,000 units per year.

According to the Federation of Thai Industries, in the first half of 2023, Chinese brands accounted for over 70 percent of Thailand's EV sales.

Changan closes THB8.8bn deal to set up EV plant in Thailand

Changan closes THB8.8bn deal to set up EV plant in Thailand

FRIDAY, OCTOBER 27, 2023

Changan Automobile, one of China’s “big four” state-owned car manufacturers, signed an agreement on Thursday to set up its electric vehicle (EV) production base in Thailand with an investment of over 8 billion baht (US$244 million).
Subsidiary Changan Auto Southeast Asia is purchasing a 250-rai (40-hectare) plot at the WHA 4 industrial estate in the Eastern Economic Corridor (EEC), Rayong province.

EVs are due to start rolling off the production line in 2025 for export worldwide.

Managing director Shen Xinghua said the investment was a mark of the company’s confidence in Thailand and the EEC’s promotion zones, workforce and infrastructure.

He also cited the government's EV 3.5 promotion packages, due to launch next year.

EV 3.5 will provide purchase subsidies of around 100,000 baht per vehicle for imported EVs and require carmakers to offset imports with proportional domestic production.

Changan closes THB8.8bn deal to set up EV plant in Thailand


Shen said Changan's phase-one investment of over 8.862 billion baht covers production of right-hand drive vehicles, including battery EV, plug-in hybrid EV (PHEV), and range-extended EV (REEV) to penetrate the Thai market and export to Asean, Australia, New Zealand, the UK and South Africa.

The plant will have production capacity of 100,000 vehicles per year from 2025.

Phase two will see a 300-rai expansion to boost production capacity to 200,000 vehicles per year, Shen added.

Changan models will be displayed at the 40th Thailand International Motor Expo 2023 at Impact Exhibition and Convention Centre in Nonthaburi from November 30 to December 11.

Changan closes THB8.8bn deal to set up EV plant in Thailand


Chinese EV manufacturers have now invested over 52.19 billion baht ($1.44 billion) in Thailand, said Jareeporn Jarukornsakul, chair of WHA.

Under its “30@30” policy, Thailand aims to boost EV production to 30% of total vehicles manufactured, or 725,000 units per year, by 2030.

In addition to Changan Auto, also Great Wall Motors, BYD, SAIC Motor, and Horizon Plus, a joint venture between Thai oil giant PTT Group and Hon Hai Technology Group, better known as Foxconn, unveiled plans to invest in and build NEV factories in Thailand.
 

Hasco-CP begins EV battery pack production in Thailand

November 9, 2023
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Hasco-CP, a Thai joint venture between Chinese automotive components manufacturer Huayu Automotive Systems and Thailand’s Charoen Pokphand Group (CP), began production at its newly built electric vehicle (EV) battery plant at the beginning of November.

The joint venture is 51% owned by Hasco and 49% by CP.

The 12-hectare facility, located in the New Energy Industrial Park in Chonburi province, has annual capacity for 50,000 battery packs and includes a fully automated assembly and testing facilities covering 60 processes.

The plant will mainly supply battery packs to SAIC Motor-CP, a local joint venture between China’s largest vehicle manufacturer SAIC Motor and CP, to help strengthen its presence in the country’s fast growing zero emission vehicle market.

SAIC Motor mainly sells vehicles in the region under its MG brand.

Speaking at a launch ceremony, SAIC Motor-CP president Zhao Feng said his company began selling EVs in Thailand in 2019 and had sold 18,000 units so far.

Nattapol Rangsitpol, general secretary of Thailand’s industry ministry, said: “As the first EV battery factory is launched in the country it demonstrates Thailand’s readiness to become a regional and global EV production base.”

Thailand is rapidly becoming the main production hub for EVs in south east Asia, driven by a growing number of Chinese automakers establishing operations there. The Thai government wants EVs to account for 30% of total vehicle production by 2030.

Gotion High Tech, a Chinese electric vehicle (EV) battery manufacturer based in Anhui province, is building a battery pack assembly plant with completion scheduled for the end of the year.
 
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