NHK: Visit to China’s BYD’s new factory in Thailand
・New factory in Thailand will cut into Japanese car market share
・Rayong province in eastern Thailand, two hours from Bangkok
Summary from NHK’s Business Special.
China’s largest EV manufacturer BYD:
Currently, Chinese manufacturer BYD is expanding EV sales in Thailand.
We visited the new factory in Thailand to cover China’s strategy and Japan’s crisis.
Coverage of BYD’s new factory in Thailand:
We covered the completion ceremony on July 4, 2024.
1. BYD’s new factory will cut into the stronghold of Japanese cars.
2. We headed to Rayong province in eastern Thailand, two hours from the capital Bangkok.
BYD’s Rayong factory:
EVs will be exported to Southeast Asian countries from here.
1. The factory was built on a vast site the size of 20 Tokyo Domes.
2. It is planned to produce as many as 150,000 EVs per year.
Covering the completion ceremony of the Thai factory:
Initially, coverage of the completion ceremony was limited to Chinese and Thai media.
At first, permission was not granted, but we were able to get it.
We will give you a detailed report on BYD’s strategy on the production line.
Research in central Bangkok:
At 5pm on July 28th, we counted the cars driving on Rama IV Road.
1. Amazingly, 81 out of 100 cars in Bangkok were Japanese cars.
2. Almost all cars seen in rural Thailand were Japanese cars.
Japanese cars entering Thailand:
In the 1960s, the strong yen accelerated the entry of Japanese manufacturers into Thailand.
1. Toyota, Honda, Nissan, Isuzu Motors, and others entered Thailand.
2. After the Plaza Accord in 1985, eight major Japanese companies established production bases.
Many parts manufacturers also entered the country and built supply chains.
Toyota’s pickup truck:
Japanese manufacturers are particularly good at pick-up trucks.
1. In Thailand, the cargo bed is modified to be like a shared bus.
2. It can be used in various ways, such as carrying agricultural products and goods.
Its powerful driving, durability, and convenience make it popular, accounting for 40% of new car sales.
Toyota’s sales share:
Toyota has an overwhelming share in Thailand.
In 2023, it will lead the market with a sales ratio of 34.3% in Thailand.
Chairman Toyoda Akio is said to have a special attachment to Thailand.
In the early 2000s, a locally-specified pickup truck was developed.
Signs of change in Japanese car share:
However, there are signs of rapid change in Thailand.
For me, living in Bangkok, taxi dispatch apps are indispensable.
1. Recently, when I call a car, it is becoming more common for Chinese EVs to arrive.
2. Most of the EVs are Chinese-made, such as “AION”, “NETA”, and “MG”.
Rapid increase in Chinese car share:
In recent years, 10 Chinese car companies have entered Thailand and started selling EVs.
Sales dealers in Bangkok:
There is a trend of Japanese car dealers switching over to Chinese manufacturer stores.
1. The market share of Japanese cars was 90%, but it fell to 78% in 2023.
2. The market share of Chinese cars increased from the 2% range to 10%.
The construction rush of Chinese EV factories:
This year, the offensive of Chinese manufacturers is gaining momentum.
Great Wall Motors’ Thai factory:
In January 2024, China’s Great Wall Motors opened a new EV production line at its Thai factory.
China’s “NETA”:
In March, the Chinese EV brand “NETA” began local production.
China’s largest BYD:
And in July, China’s largest EV manufacturer BYD also began local production.
Covering BYD’s completion ceremony:
NHK was able to cover the factory completion ceremony.
200 Chinese media members attended the ceremony, creating an atmosphere of excitement.
BYD founder and chairman Wang Chuanfu:
Thailand is entering a new era of automobile production.
BYD has declared that it will bring EV technology to Thailand.
Coverage of BYD’s production site:
NHK was given special permission to cover the production site.
The site was the assembly line for the compact EV Dolphin.
Dolphin assembly line:
1. The workers’ conversations are a mixture of Thai and Chinese.
2. Chinese engineers give advice to Thai employees on work procedures.
Explanation from a factory official:
They are teaching Chinese-style manufacturing methods within the factory and promoting Chineseization.
3. On the day of the visit, 400 people were working on the line.
4. Two Chinese engineers are in charge of technical training for three Thai workers.
In the future, the factory plans to employ 10,000 employees.
Experienced Chinese engineers personally impart EV production know-how.
In the future, a system will be established to produce batteries and transmissions.
Partnering with a Thai university of technology:
Human resource development is not limited to the factory.
1. In 2023, BYD partnered with a number of public universities of technology in Thailand.
2. Started accepting EV and autonomous driving research and internships.
Building a supply chain:
There is also active activity toward building a supply chain.
Business meetings are also being held to procure auto parts from Thai parts manufacturers.
Slowing growth in sales in China:
Up until now, the number of EVs sold in China has been steadily increasing.
However, since 2023, the growth in sales in China has slowed.
1. Now, price reduction competition due to overproduction is intensifying.
2. Chinese manufacturers’ profits are rapidly deteriorating.
Thai government’s shift to EVs:
The sense of caution toward China is not as high as in Europe and the United States.
3. In Thailand, this coincides with the Thai government’s desire to promote the EV shift.
4. Thailand has established a preferential policy of zero tariffs on Chinese EV imports.
Japanese manufacturers withdraw from Thailand:
Japanese manufacturers have been forced to scale back or withdraw from Thailand.
1. Subaru has announced that it will withdraw from local production.
2. Suzuki has decided to close its Thai factory at the end of 2025.
3. Honda also plans to consolidate its two Thai factories into one in July.
The above manufacturers have continued to sell mainly gasoline-powered vehicles.
Thai Prime Minister Seta
In December 2023, Thai Prime Minister Seta gave an interview to Japanese media.
He expressed concern that “Japan is somewhat behind in EV production.”
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They should actively introduce EVs in the future while they still can.
1. Demand for hybrid vehicles in Japan is also quite strong.
2. The selling prices of used cars in Japan have been able to maintain a high price level.
It is necessary to recognize that now is the last chance.