【By Observer News, Wang Yi】"The surge in China's electric vehicle sales is breaking the long-standing monopoly of Japanese automakers in Southeast Asia." According to a report by the UK's Financial Times on September 30, this disruptive trend may also unfold in other regions.

PwC data shows that in the first half of this year, the market share of Japanese car companies represented by Toyota, Honda, and Nissan in the six major markets of Southeast Asia has dropped to 62%, while in the 2010s, this share averaged around 77%. In contrast, the market share of Chinese cars in the region has risen from almost zero to over 5%, securing a place in the Southeast Asian market with an annual sales volume of about 3.3 million vehicles.

"The entry of Chinese electric vehicle manufacturers signals the end of Japan's era of unchallenged dominance," said Patrick Ziechmann, a partner at PwC Malaysia.

Ramesh Narasimhan, who previously served as the president of Nissan Thailand, also stated directly that as Chinese companies continue their "offensive," Japanese automakers will keep losing ground in their own "backyard," which used to be a territory where they never lost. He said that Chinese automakers have rapidly expanded their sales and market share through flexible pricing strategies, and "this trend is visible across all Southeast Asian markets."

According to the report, despite the overall decline in the car market in Indonesia, the largest consumer market in Southeast Asia with a population of 280 million, Chinese car sales are growing exponentially. Although Japanese automakers remain the market leaders, their sales are declining month by month. From January to August this year, Toyota's sales in Indonesia fell by 12% to 161,000 units, while BYD's sales increased threefold to nearly 19,000 units.

Chinese auto brands at the Indonesia International Motor Show. Visual China

The Financial Times believes one of the key factors behind the rapid growth of Chinese cars is their affordable prices, with Chinese cars in Indonesia priced at about 200 million Indonesian rupiah (approximately 85,500 RMB).

Additionally, incentives provided by the Indonesian government for electric vehicles, such as the exemption of import duties, have also helped Chinese automakers expand their local market. However, some of these incentives will stop next year, and only automakers that produce locally can receive subsidies. Currently, there are 15 Chinese brands in the Indonesian market, and it is expected that five more new brands will enter soon, with at least three Chinese automakers already establishing production bases in Indonesia, while the rest are assembling through local partners.

Jongkie Sugiarto, vice chairman of the Indonesian Automotive Industry Association, analyzed that Japanese automakers must take action, or else their market share will continue to decline.

"In Singapore, the rise of Chinese car brands is even more noticeable," reported the article. BYD has replaced Toyota as the top seller in the country this year, while in 2023, Toyota still accounted for 25% of car sales in Singapore.

Singapore's government is promoting policies such as the construction of charging facilities, and together with the large-scale entry of Chinese electric vehicle brands, this has prompted Singapore consumers to shift toward electric vehicles. BYD not only sets up showrooms in Singapore shopping malls and city centers but also collaborates with the catering and entertainment industries to strengthen its market presence.

Adam Mirza, who sells Japanese cars in Singapore, pointed out that Japanese brands seem to "have accepted the fact that they cannot compete with China in electric vehicles."

The Financial Times analysis states that Chinese automakers lead in in-vehicle software, while traditional Japanese car manufacturers have developed slowly in this area. Now, Chinese automakers plan to further widen their leading advantage. XPeng started exporting the X9 model equipped with smartphone remote parking functions to Southeast Asia in February this year. Its vice chairman and co-president Gu Haidi said in April: "We believe Southeast Asia is a market full of potential."

Vincent Hor, a Malaysian businessman who bought a BYD electric vehicle in June this year, evaluated to Nikkei Asia on August 19 that the car offers voice command, rotating touchscreens, and other features, with low maintenance costs. The report points out that with competitive prices and advanced in-vehicle functions, Chinese companies are "eroding" the long-term leading position of Japanese car manufacturers, and the cautious attitude of Japanese automakers towards electrification has also left room for Chinese automakers.

As the regional manufacturing structure transforms, the position of Japanese automakers in Thailand is also shrinking. Subaru closed its factory in Thailand last year, and Suzuki plans to stop production by the end of 2025. Meanwhile, BYD recently exported the first batch of cars from its Thai factory to Europe.

Liu Xueliang, general manager of BYD's Asia-Pacific automotive sales department, said that Japanese automakers once contributed to the economic development of the region, "but we will let consumers decide who the final winner is."

Jessada Thongpak, deputy director of S&P Global Mobility ASEAN, expects that by 2032, Chinese automakers will capture 20% of the market in Thailand.

Thongpak analyzed that the expansion model of Chinese automakers in Southeast Asia is likely to be repeated in other markets. "Although the Latin American market is still in an early stage of development, the trends are similar to those in Southeast Asia, and we are also in an early stage, but the development is fast."

Data from the China Association of Automobile Manufacturers shows that from January to August this year, China's整车 exports reached 4.292 million units, an increase of 13.7% year-on-year, with新能源汽车 exports reaching 1.532 million units, an increase of 87.3% year-on-year.

Counseling company AlixPartners previously predicted that by 2030, Chinese automakers will account for 30% of global car sales, with the fastest growth expected in emerging markets such as Southeast Asia, the Middle East, Africa, and South America.

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Original: https://www.toutiao.com/article/7555877317189321242/

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