China's Intense EV Rivalry Tests Thailand's Local Production Goals

South-east Asian nation's electric vehicle incentives face pressure from oversupply

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BANGKOK, Thailand —Hyper-competition in China's electric vehicle (EV) sector is spilling over to Thailand — its biggest market in Asia — as smaller players struggle to compete with a dominant BYD, putting ambitious local production plans at risk.

Neta, among the earliest Chinese EV brands to enter Thailand in 2022, is an example of a struggling carmaker finding it difficult to meet the requirements of a demanding government incentive programme meant to boost Thai EV production.

Under the scheme, carmakers are exempted from import duties but obligated to match import volumes with domestic production in 2024. Citing slowing sales and tightening credit conditions, carmakers asked the government to adjust the scheme, and the 2024 production shortfall was rolled over into 2025.

Neta has said that it cannot produce the required number of cars locally and that the government has withheld some payments to the EV maker, said Excise Department official Panupong Sriket. He received a complaint filed in June by 18 Neta dealers in Thailand seeking to recover more than 200 million baht (S$7.9 million) of allegedly unpaid debt.

The complaint, a copy of which was reviewed by Reuters, also detailed missed payments by Neta related to promised support for building showrooms and after-sales service.

Neta dealership owner Saravut Khunpitiluck said: "I stopped ordering more cars in September because I sensed something was wrong. I'm currently suing them."

Neta's parent company, Zhejiang Hozon New Energy Automobile, entered bankruptcy proceedings in China in June, according to Chinese state media.

Neta and its Chinese parent did not respond to Reuters' requests for comment.