Chinese automakers receives positive response from Thai consumers
FTA benefits, price competitiveness, and government incentives drive success.
Chinese automakers have rapidly gained a strong foothold in the Thai automotive market with its affordable and modern vehicles, capturing a 72% favourable perception among Thai consumers.
Kajornkiat Kiatsunthorn, Research Director at Kadence International, said that by setting up production facilities in Thailand, Chinese automakers benefit from lower production costs and avoid import duties. This local production strategy not only reduces costs but also strengthens relationships with Thai suppliers, creates jobs, and improves their brand image.
"Most importantly, the Thai government has offered investment incentives to attract foreign automakers, especially for EVs, including Chinese companies, which make them very competitive in many ways," he added.
A significant factor driving Thai consumers' positive sentiment towards Chinese electric vehicles (EVs) is their price competitiveness. "Chinese cars are often priced 10-20% lower than equivalent models from Japanese brands," said Kiatsunthorn. "This price advantage has been really crucial to the Thai consumer; they are seeking value without compromising on quality and features."
Chinese automakers have leveraged advanced technology to appeal to tech-savvy Thai consumers. "They put things like advanced driver assistance systems, high-tech infotainment systems, which Thai consumers never have from Japanese brands at this price point," noted Kiatsunthorn. Additionally, the modern, sleek design of vehicles from brands has also resonated well with Thai buyers.
While there are a few Japanese brands attempting to introduce their EV models into the Thai market, they have struggled to compete. "Most of them are Chinese. There are some Japanese brands that try to introduce their model into the market but have not successfully launched yet because compared to the Chinese, that price cannot compete, and also technology is still inferior to the Chinese," Kiatsunthorn observed.
Thai government policies have played a significant role in encouraging EV adoption, thereby benefiting Chinese manufacturers. "The government offers significant reduction in excise taxes for EVs compared to traditional gasoline vehicles. This made EVs more affordable for consumers," explained Kiatsunthorn. Additionally, manufacturers with production facilities in Thailand benefit from reduced or eliminated import duties on completely knocked down parts, further lowering production costs.
