“While Chinese OEMs are gaining market share in most markets outside North America, two Thailand-specific factors lie behind this particularly rapid success: The Thailand-China free trade agreement and Thailand’s EV scheme. Thailand has formally high tariffs of 80% on imported vehicles, but significantly lower ones with its free trade partners. Japan-made cars enter Thailand at a 20% tariff rate under the Japan–Thailand Economic Partnership Agreement. But Thailand’s 2003 agreement with China means that China-made EVs face no tariffs at all, giving Chinese exporters a huge competitive advantage.”
“In addition, Thailand’s government—eager to reduce dependence on oil imports and meet the country’s climate targets—has also rolled out generous EV incentive schemes. The EV 3.0 program, starting in 2022, involved direct cash subsidies to buyers, excise tax cuts for qualifying EVs, and import tax cuts paired with offset requirements, namely requirements to make up imported vehicles with a certain amount of locally produced vehicles (Table 1). While the Thai government also offers various tax cuts and subsidies to promote local production and local content, the deferred offset timelines (starting in 2024 only) meant Chinese carmakers were able to export EVs to Thailand for two years not just tariff free, but also boosted by a highly preferential tax and subsidies regime. Naturally, Chinese EV makers piled in. By the middle of 2025, over a dozen Chinese brands were present in the Thai market, with China’s largest players (BYD, Changan, Chery, GWM, and SAIC) making up most of these sales. By end-2025, Chinese EV makers had captured 89% of Thailand’s EV market.”
https://rhg.com/research/how-chinese-cars-took-over-thailand/