With the support of the Thai PM, major automotive player eyes expansion into Vietnam?

Published by on . Updated on 10 Jan 2024

Recently, Prime Minister Srettha Thavisin of Thailand announced that he led top executives from Tesla to visit industrial areas for discussions regarding the investment plans of the world's largest electric car company in Thailand.

Mr. Thavisin shared that he has made extensive efforts to make high-level personnel from Tesla "fall in love with Thailand." He also revealed that Tesla is actively seeking a land area of approximately 320 hectares. Based on information from Reuters, the Prime Minister appears confident that Tesla will proceed with investments in Thailand.

About a month ago, the meeting between Mr. Srettha Thavisin and Tesla's CEO, Elon Musk, took place.

Currently, Thailand leads the Southeast Asian region as a major automobile manufacturer and exporter. In the Thai automotive market, Japanese brands such as Toyota, Isuzu, and Honda consistently top the sales charts.

Thailand has set a target to transition approximately one-third of the total annual production of 2.5 million vehicles to electric cars by 2030. Additionally, the country has implemented favorable policies and incentives to attract investments and facilitate the shift towards electric vehicle production.

In fact, the Prime Minister of Thailand has had several meetings and discussions with Elon Musk and high-ranking officials from Tesla.

In September, Mr. Srettha Thavisin embarked on a visit to New York, USA, during which he engaged in a conversation with Elon Musk about the electric vehicle industry.

In November, the Prime Minister of Thailand also traveled to the United States to attend the APEC conference and visited Tesla's factory. During this visit, Mr. Srettha Thavisin had discussions with the company's leaders, urging them to invest in Thailand.

In a subsequent interview, the Prime Minister of Thailand disclosed that Tesla is planning to invest around $5 billion to establish a factory in Thailand. Following this announcement, Mr. Srettha Thavisin warmly welcomed Tesla's executives and guided them on a tour of industrial areas.

Before the recent visit of high-ranking officials from Tesla to Thailand, the world's leading electric car manufacturer has been exploring opportunities to enter various markets within the Southeast Asian region.

In July, Tesla established its headquarters in Malaysia and initiated the development and construction of charging stations within the country all together. In August, there were reports from Indonesia indicating that Tesla is planning to build a domestic battery manufacturing plant in the country, as reported by Reuters.

According to information from Straitstimes, Thailand currently holds approximately half of the total electric car sales in the Southeast Asian region, with Vietnam and Indonesia following behind.

In the Southeast Asian market, BYD is one of the prominent electric car manufacturers, maintaining a significant market share. Globally, BYD is closely monitoring Tesla, creating a competitive landscape and presenting numerous challenges for the American electric car manufacturer to maintain its position.

In the current scenario, establishing a car manufacturing plant directly in the region seems to be a reasonable strategy, especially as Tesla is developing the Model 2, a cost-effective model suitable for the markets of developing countries.

However, the official decision regarding whether Tesla will set up a plant in Thailand is expected to be announced in the first quarter of 2024. If this decision is made, it would not be surprising for Tesla to also distribute cars in other prominent electric vehicle markets in the region, such as Vietnam and Indonesia.

It's important to note that there is currently no information about Tesla engaging in business operations in Vietnam. Nevertheless, with Vietnam being recognized as a prominent electric vehicle market in the region and the presence of several privately imported Tesla models, this indicates that Vietnam has the potential to become a significant market.

Original article by AutoPro

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