Thailand introduced subsidies and tax cuts to encourage electric vehicle adoption, but is now recalibrating policies alarmed by the threat to its industrial landscape. In Rayong, China's BYD built its first factory outside China, a complex the size of 180 football fields. Twenty miles south, a General Motors plant is now owned by Great Wall Motor, while Ford took over a Suzuki assembly plant. All within the past five years. For decades, Japanese automakers dominated Thailand, transforming it into the "Detroit of the East." Today, Chinese automakers control about 85 percent of Thailand's electric vehicle market, up from almost zero four years ago. Japanese automakers, slow to embrace the technology, have struggled. In 2024 and 2025, Subaru and Suzuki shut down their Thai plants, while Nissan and Honda scaled back production. Several auto-parts suppliers dependent on Japanese manufacturers went bankrupt, threatening a supply chain employing about 700,000 workers.
Policymakers are concerned about the influx. About two-thirds of electric vehicles sold in Thailand in the first seven months of 2026 were imported, primarily from China. The government unveiled a three-tier tax system imposing highest rates on automakers importing vehicles with no local production plans and lowest on those sourcing parts locally. However, Professor Ruth Banomyong says there is little evidence Thailand is benefiting, as Chinese automakers operate within a "closed ecosystem." He and colleagues estimate 300,000 jobs could disappear within five years if electric vehicles dominate the market. Tossophol Kunsri of the Automobile Labor Congress says Chinese EV makers often hire Thai workers for short-term contracts without severance and reject unions.
Source: New York Times Business · Summarized by HeadlinesBriefing