Chinese Electric Cars Disrupting Auto Market In Thailand?

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The brand new AlixPartners report 2024 Global Automotive Outlook has stimulated various ideas and suggestions. Steve Hanley kicked things off along with his abstract of the findings. Studying by way of that, I couldn’t assist chiming in by pulling out a couple of key highlights and expounding on them. In between, although, a reader contributed what is likely to be essentially the most fascinating remark of all. Writing the remark below Steve’s article, “UjiBebek” contributes the following:

Throughout a current journey to Thailand I observed a major variety of Chinese language EVs on the roads. In keeping with information revealed not too long ago, EVs gross sales within the first 5 months of 2024 elevated by 31% to 43k items, whereas complete autos gross sales dropped by 24%, right down to 260k items.

I mentioned this subject with a neighborhood buddy, and I discovered fascinating the impression EVs are having on the automotive market general. The supply of low-cost imports from China has triggered a generalized discount within the costs of vehicles within the Kingdom.

New vehicles costs dropped considerably, with worth reductions of as much as 20% utilized by sellers on the MSRP of some autos, particularly these that are in direct competitors in opposition to the Chinese language imports. And consequently, Suzuki and Subaru introduced their intention to shut store and exit the native market by the top of 2024.

However the place the decrement is especially evident, is within the worth of used vehicles. Depreciation of used vehicles in Thailand has at all times been restricted (when in comparison with developed nations akin to Japan, Singapore, the USA, and so forth.), serving to prospects who needed to improve their every day drive to a newer automobile. At current, nevertheless, the residual values of used autos are normally decrease than the excellent money owed owed to the banks.

That is forcing prospects, who would have in any other case modified their automobile with a brand new one, to stay to their present one until the finance contract terminates (usually 60 or 72 months). And it’s severely limiting their choices when the time comes to change to a brand new automobile.

Attention-grabbing!

So, initially, let’s take these EV gross sales figures a step additional. 31% gross sales development within the midst of a broader 24% drop in gross sales within the general auto market is big. Which means EVs rose from about 12.5% to about 16.5% market share. Thailand ought to quickly be at round one out of each 5 new vehicles bought being electrical, then one out of each 4 new vehicles bought being electrical, then. …

However exponential development is one factor. Disrupting pricing within the auto market and basically chasing some firms out of it within the course of is one thing else.

Low cost electrical vehicles from China appear to be doing one thing particular in Thailand. I’m very curious to discover in additional element with native information sources, and much more than that, I’m curious to see if these sorts of issues are occurring in different less-talked-about nations in Asia, Africa, and the Americas.

Photographs from OFFER Thailand.