Chinese New Energy Vehicles Forge Deep Cooperation with Southeast Asia

At the third China International Supply Chain Promotion Expo, many Chinese new energy vehicle companies showcased highlights of their deep cooperation with Southeast Asian countries in the industrial and supply chains. Amid significant external uncertainties, China's new energy vehicles are establishing connections with Southeast Asia, opening up new paths for win-win cooperation. Observers believe that the connectivity and investment ease in the Southeast Asian region are continuously improving, allowing Chinese new energy vehicle companies to shift from 'product export' to 'collaborative industrial chain expansion' abroad, meeting local market demands through localized production and promoting the development of the Southeast Asian automotive industry through technology transfer and joint industrial construction. The timing for extending the chain is just right. In recent years, the Regional Comprehensive Economic Partnership (RCEP) has continued to release economic and trade dividends, further enhancing regional connectivity. More and more Chinese companies, particularly new energy vehicle firms, are recognizing the advantages of ASEAN countries in policy support and supply chain management, viewing them as destinations for 'going out' and 'extending the chain' of industrial chains. At this year's expo, many participants noted that Southeast Asian countries are creating a more favorable business environment, upgrading supply chain construction and management levels to attract companies from China and other regions. The chairman of the International Affairs Committee of Singapore's Chinese Chamber of Commerce, Xie Jinfeng, stated that China possesses strong innovation capabilities. With the comprehensive completion of negotiations for the China-ASEAN Free Trade Area 3.0, there will be further expansion of mutually beneficial cooperation between China and ASEAN in areas such as the digital economy, green economy, and supply chain connectivity. Narit Tesarit, secretary-general of the Thailand Board of Investment, introduced Thailand's advanced 5G network, expanding data centers, and strong logistics capabilities, along with a robust supply chain network and a friendly legal environment, making it an industrial investment hub in Southeast Asia. Qiu Weigong, chairman of the Amata Group in Thailand, reported that the Amata Industrial Park in Thailand has 650 automotive supply chain supporting factories, providing an ideal environment for the overseas expansion of China's new energy vehicle industry. Singapore's UOB China executive director, Xin Tao, mentioned that ASEAN countries have adopted measures in recent years to optimize the supply chain environment, such as Singapore utilizing blockchain technology to enhance supply chain transparency and flexibility, Vietnam simplifying customs procedures and reducing tariffs to support cross-border e-commerce, and Malaysia encouraging companies to apply smart manufacturing technologies to reduce production costs. Against this backdrop, Chinese automakers including BYD, Geely, Great Wall, GAC, SAIC, and Chery are actively expanding into the Southeast Asian market. Xu Haidong, executive vice-secretary of the China Association of Automobile Manufacturers, recently stated that the Southeast Asian region, with its advantages in policy, market, supply chain, and geography, is attracting Chinese new energy vehicle companies to establish factories, procure, and sell locally. The market potential is significant as Southeast Asia has become one of the most concentrated areas for Chinese overseas investment and an important target market for new energy vehicles. Xu analyzed that Chinese new energy vehicles are competitive and have maintained high export growth in recent years. As the Southeast Asian economy develops, the market potential will further be unleashed, transforming from a trade hub in the global automotive supply chain to a terminal market, providing new opportunities for Chinese companies. Scholar Li Peimin from Malaysia's International Islamic University estimates that by 2030, the middle-income population in Southeast Asia will reach 472 million, presenting an extremely attractive potential market for businesses. A report from international consulting firm EY-Parthenon indicates that the electric vehicle markets in Indonesia, Malaysia, Thailand, and Singapore are expected to see significant growth, with total electric vehicle sales projected to increase from $2 billion in 2021 to between $80 billion and $100 billion by 2035. In order to better establish the supply chain in Southeast Asia, Chinese new energy vehicle companies are actively shifting strategies to promote localized production, quickly responding to regional market differentiation demands, and driving sustainable growth in overseas sales. Great Wall Motors' cooperative KD factory in Malaysia has successfully assembled its first product, the Haval H6. BYD's Thailand factory commenced production last July, covering the entire process from stamping to painting, welding, and final assembly. SAIC-GM-Wuling's 3 millionth new energy vehicle rolled off the assembly line in Indonesia in May this year. Geely's EX5 electric vehicle has completed trial production at its Indonesian factory... The establishment of the industrial chain supports Chinese new energy vehicles to better cater to the demands of the Southeast Asian market, reducing costs and leading to strong sales locally. Data from the Indonesian Automotive Industry Association recently showed that wholesale sales of pure electric vehicles in Indonesia grew by 267% year-on-year in the first half of this year, with Chinese automotive brands accounting for over 90% of sales. Industry insiders pointed out that the diversification of brands and the promotion of localized production are the main factors driving the rise in sales. Statistics from the Thai Automotive Association reveal that Chinese brands dominate the electric vehicle market in Thailand, with four out of the top five electric vehicle sales last year coming from China. Great Wall Motors' managing director in Malaysia, Cui Anqi, stated that as of the first half of this year, sales of the locally assembled Haval H6 have ranked second in Malaysia's hybrid SUV market. The president of the Asia Electric Vehicle Association and the head of the Philippines Electric Vehicle Association, Edmond Alaga, noted that China leads in new energy vehicle research and development, battery innovation, infrastructure, and industrial scale. The increasing demand for environmentally friendly transportation among the people in ASEAN countries creates a strong synergy between the two markets. Currently, Southeast Asia is gradually becoming a frontier with strong potential for industrial agglomeration. Chinese new energy vehicle companies have achieved comprehensive output in technological innovation, industrial chain support, talent cultivation, and efficient management, continuously generating positive effects in promoting the development of the local automotive industry and co-building the industrial ecosystem. Xu Haidong believes that as the automotive industry enters an era of electrification and intelligence transformation, Chinese new energy vehicles possess advantages in scalability, systemization, and rapid iteration, making them leaders in global industrial innovation. The establishment of a complete industrial ecosystem in Southeast Asia will help enhance the local automotive industry's modernization level and international competitiveness through the application of new technologies such as intelligent cockpits and automatic parking at higher cost-effectiveness. In recent years, more and more Chinese companies have proactively connected with Southeast Asian partners, strengthening technological and production cooperation, and rapidly becoming an important part of the Southeast Asian automotive industry ecosystem. In Thailand, after BYD's factory in Rayong Province commenced production, it introduced advanced flexible production solutions locally, effectively promoting the transformation and upgrading of the local automotive supply chain. Building on this foundation, BYD continues to launch more pure electric vehicle models in Thailand and plans to introduce plug-in hybrid technology to effectively enhance Thailand's automotive manufacturing capacity. In Malaysia, Geely Group has not only invested in the Malaysian national brand Proton, helping it turn losses into profits and achieve brand revitalization, but also participated in the construction of Malaysia's Tanjung Malim High-Tech Automotive Valley, contributing to the establishment of an ASEAN automotive industry center. Currently, more and more Chinese new energy vehicles are seen on the streets of Southeast Asian countries. The connections established by Chinese new energy vehicle firms with Southeast Asia are becoming more stable and far-reaching, jointly creating a new industrial ecosystem characterized by deep integration and win-win cooperation.