Thailand Rewrites EV Subsidy Program to Cope With China-Led Glut
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The 46th Bangkok International Motor Show opened on March 26, featuring vehicles from 41 automakers, including at least 16 Chinese brands. Photo: Wen Simin/Caixin
Thailand has adjusted its electric vehicle subsidy program to encourage carmakers to export, as its domestic market is suffering from overcapacity and cutthroat price competition fueled by a surge of Chinese investment.
On Tuesday, Thailand’s National Electric Vehicle Policy Committee approved revised incentive rules that reward exports. Under the updated program, each electric vehicle (EV) exported from Thailand will count as 1.5 units toward the automaker’s local production commitments — effectively allowing firms to meet domestic requirements by shipping cars abroad.
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- Thailand revised its EV subsidy program to reward exports, with each exported EV now counting as 1.5 units toward local production commitments.
- The country faces EV overcapacity: 386,000 annual capacity versus about 70,000 domestic sales in 2024, fueled by 21 projects and $1.26 billion in investment, largely from Chinese firms.
- Exports are projected to reach 12,500 units in 2025 and 52,000 in 2026, amid growing regional competition, especially from Indonesia.
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Who’s Who
- SAIC Motor Corp. Ltd.
- SAIC Motor Corp. Ltd. is a Chinese automaker that has invested in Thailand's electric vehicle (EV) manufacturing sector. Along with other Chinese firms, SAIC has contributed to the overcapacity and competitive pricing in the Thai domestic EV market. An SAIC source indicated that the cost of producing cars in Thailand is higher than in China, making government support crucial for export competitiveness.
- Great Wall Motor Co. Ltd.
- Great Wall Motor Co. Ltd. is one of several Chinese automakers that have heavily invested in Thailand's electric vehicle (EV) manufacturing sector. These companies have established production facilities in the country, contributing to the significant overcapacity in the Thai EV market due to their aggressive pricing strategies and the influx of Chinese investment.
- BYD Co. Ltd.
- BYD is a Chinese automaker that has invested in EV production in Thailand. The company's aggressive pricing strategies have led to market tensions, including complaints after price cuts. BYD is also expected to open a manufacturing plant in Indonesia in late 2025 or early 2026.
- Guangzhou Automobile Group Co. Ltd.
- Guangzhou Automobile Group Co. Ltd. (GAC) is a Chinese automaker that has invested in EV production in Thailand. Along with other Chinese firms, GAC has contributed to the overcapacity in Thailand's EV market through aggressive pricing strategies. GAC also began production at its Indonesian plant in June 2025, indicating its broader regional expansion efforts.
- Chongqing Changan Automobile Co. Ltd.
- Chongqing Changan Automobile Co. Ltd. is a Chinese automaker that has invested in electric vehicle (EV) production in Thailand. Along with other Chinese firms, its significant investments have contributed to overcapacity and intense price competition in the Thai EV market.
- GAC Group Ltd.
- GAC Group Ltd. is a Chinese automaker that has invested in production facilities in Thailand, contributing to market saturation and intense competition. The company has also expanded its manufacturing presence into Indonesia, with production at its Indonesian plant commencing in June 2025. This strategic move aligns with Thailand's ambition to become an EV export hub, even as it faces regional competition.
- XPeng Inc.
- XPeng Inc. is a Chinese automaker that has recently started production at its plant in Indonesia, as of June 2025. This move contributes to the regional competition for Thailand's aspiration to become an electric vehicle export hub.
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What Happened When
- 2022：
- Thailand introduced generous subsidies for EVs under the EV3.0 and EV3.5 programs, promising cash incentives for both imported and domestically assembled EVs.
- 2024：
- Automakers were required to produce one locally assembled EV for each subsidized import.
- 2024：
- Domestic EV sales in Thailand reached roughly 70,000 units.
- July 2024：
- Complaints were filed against BYD after the company cut prices shortly after consumers made purchases.
- By 2025：
- The requirement for automakers was set to rise to a 1.5-to-1 ratio of locally assembled EVs for each subsidized import.
- First half of 2025：
- Domestic EV sales in Thailand totaled around 57,000 units.
- 2025：
- The Federation of Thai Industries projects the new measure will stimulate EV exports to reach nearly 12,500 units.
- Since June 2025：
- GAC Group Ltd. and XPeng Inc. started production at their Indonesian plants.
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