Chinese electric automaker BYD dominates the Southeast Asian market with its innovative and affordable models. It successfully overthrew Tesla with its more than a quarter share in the region’s electric vehicle market, Reuters reports.
Distribution partnerships
BYD’s strong presence in the domestic market is largely due to its distribution partnerships with established local conglomerates.
These partnerships enable the foreign brand to expand its operations, test customer demand, and steer government policies, the report asserted, citing three partners and analysts.
It gives BYD a major advantage in growing its market share over Tesla’s “go-it-alone” EV distribution system.
“At present, BYD’s primary focus is on brand proliferation rather than optimizing profit margins. By providing local dealers with more lucrative profit margins, BYD can cultivate trust and loyalty, paving the way for broader expansion.”
BYD
BYD accounted for over 26% of all electric vehicle sales in the Southeast Asian market in Q2 2O23. Its $30,000 BYD Atto 3 was the top-selling model in the region, Counterpoint indicated. In contrast, the Tesla Model 3 sells for $57,500 in Thailand.
Significance
These distribution partnerships substantially aid BYD in promoting and selling its EV models in the region where Chinese brands struggle to build a track record, Urban Science’s Managing Director for China asserted.
“If buyers are unsure or have any concerns, partnering with established players like Sime Darby, Bakrie & Brothers, or Ayala Corp will give them the peace of mind, especially for aftersales support.”
Chee-Kiang Lim, Urban Science’s Managing Director for China
Some of BYD’s major distributors are as follows:
- Sime Darby in Malaysia and Singapore
- Indonesia’s Bakrie & Brothers
- Ayala Corp in the Philippines
- Thailand’s Rever Automotive
The Chinese automaker will invest approximately $500 million in its new Thai factory. It aims to hit annual production of 150,000 EVs from 2024.
Beating Tesla
The Thai EV market accounted for 24% of BYD’s foreign sales in Q2 2023, Counterpoint reported. This notable rate advanced the country’s position as the leading overseas market for the Chinese automaker.
Meanwhile, Tesla only has two stores in the region, which are concentrated in Singapore. Tesla also employs a direct-to-consumer sales model, unlike BYD’s distribution partnerships.
Electric vehicle adoption in Southeast Asia has undoubtedly been progressive owing to the presence of industry leaders like BYD and Tesla and significant government initiatives. EVs accounted for 6.4% of all the region’s passenger vehicle sales in Q2 2023, up 3.8% from the previous quarter.
