In an effort to bolster Thailand’s automotive supply chain, the Industry Ministry is urging Chinese electric vehicle (EV) manufacturers to source at least 40% of their components locally. This initiative aims to support Thai auto parts makers as the industry transitions from internal combustion engines (ICE) to electric mobility technology.
The 40% local content threshold emerged from discussions between the ministry and GAC Aion New Energy Automobile, an EV manufacturer under Guangzhou Automobile Corporation (GAC), which has committed to using 40% local parts. Industry Minister Pimphattra Wichaikul emphasized the importance of collaboration between car manufacturers and Thai auto parts makers, particularly as the latter adjust to new technologies.
“Officials recently held discussions with GAC Aion and other Chinese EV makers concerning the use of auto parts produced by Thai companies,” Minister Pimphattra told the Bangkok Post. “We also talked with them about EV technology transfer to develop the Thai automotive industry.”
Authorities aim to ensure local auto parts makers can adapt to technological changes and sustain their businesses amid concerns that Chinese EV manufacturers might primarily source components from Chinese firms. The Board of Investment (BoI) previously met with Chinese EV firms to explore the use of local auto parts in their operations in Thailand.
“Most Chinese EV makers agreed with the government’s request to use auto parts made by Thai companies. This is a good sign,” said Narit Therdsteerasukd, secretary-general of the BoI.
Chongqing-based Changan Automobile has committed to investing up to 10 billion baht in Thailand, starting with a local content proportion of 60%, which it plans to increase to 90% over time. Neta has pledged to source parts from 16 Thai companies, accounting for 60% of its components, with a goal to raise this to 85% in the long term. Great Wall Motor aims for 80-90% of its EV components to be sourced locally, while BTD, like GAC Aion, has committed to more than 40% local content.
Over the past 2-3 years, the BoI has supported investments worth 80 billion baht in the EV industry, resulting in a total EV production of 400,000 units. The board promotes EV industry growth by offering investment incentives to EV-related businesses, including battery production and EV charging facilities.
Minister Pimphattra reassured that the government will continue to support ICE vehicle manufacturers, which have operated in Thailand for over a decade, as well as producers of hybrid and plug-in hybrid EVs. The goal is to foster a balanced automotive ecosystem that accommodates both traditional and emerging technologies.
Authorities are set to engage with Chinese EV manufacturers and Thai auto parts makers to facilitate this transition and ensure the local industry remains competitive and sustainable.