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In an electrifying move, China's BYD (PINK: BYDDF) has inaugurated its premier electric vehicle (EV) factory in Thailand, marking its first foray into Southeast Asia's burgeoning EV sector. At the opening ceremony held in Rayong, BYD CEO and President Wang Chuanfu lauded Thailand's commitment to EVs, stating, "Thailand has a clear EV vision and is entering a new era of auto manufacturing." He highlighted the intent to transfer Chinese technology to the Thai market.
This new plant underscores a larger investment tide crossing $1.44 billion, driven by Chinese EV giants taking advantage of Thailand's government subsidies and tax incentives. Following the plant's announcement, BYD's Hong Kong-listed shares nudged by 1.6% to HK$235, marking a week-high.
A traditional stronghold for Japanese car manufacturers, including Toyota Motor (NYSE: TM), Honda Motor Co (NYSE: HMC), and Isuzu Motors, Thailand is swiftly pivoting towards EV production. The Thai government has set an ambitious goal to convert 30% of its annual vehicle output to EVs by 2030 out of 2.5 million vehicles produced annually.
Narit Therdsteerasukdi, Thailand's Board of Investment Secretary-General, remarked, "BYD is using Thailand as a production hub for export to ASEAN and many other countries," nodding to the 10-nation Southeast Asian bloc's integration strategy.
Besides its Thai venture, BYD is expanding its footprint into Europe, establishing its inaugural production base in Hungary. Slated to commence operations within three years, the facility will produce EVs and plug-in hybrids targeted at the European market. This comes in response to the European Commission's imposition of up to 38% tariffs on Chinese-manufactured EVs, whereas BYD's China-made EVs face about 17% in tariffs. The extensive Thai plant announced two years prior and valued at $490 million, boasts a production capacity of 150,000 vehicles annually, including plug-in hybrids. With the right-hand-drive EVs produced here, BYD may potentially sidestep EU tariffs, which currently apply to China-manufactured vehicles.
Liu Xueliang, BYD's Asia Pacific General Manager, added, "We will also assemble batteries and other important parts here," underscoring the plant's pivotal role in the company's international strategy.
Thailand represents BYD's largest overseas market, capturing 46% of the nation's EV segment in the first quarter. According to research firm Counterpoint, the automaker also holds the third position in Thailand's passenger car market. Other competitors in Thailand's EV arena include Great Wall Motor, which also has a production facility, and U.S. giant Tesla (NASDAQ: TSLA).
