20/09/2023 (China/ Southeast Asia) - China's EV giant BYD is thriving in Southeast Asia's market, surpassing rivals like Tesla with over 25% market share. This success stems from strategic distribution partnerships with local conglomerates, facilitating expansion and market understanding. This collaborative approach, reminiscent of Japanese automakers, allowed BYD rapid growth, though it involved certain costs.
BYD prioritizes brand expansion over profit margins, offering local dealers attractive incentives to build trust and pave the way for broader expansion. In Q2 2023, BYD secured 26% of Southeast Asia's EV market with its Atto 3 model, starting at $30,000 in Thailand, compared to Tesla's $57,500 Model 3. EVs constituted 6.4% of all passenger vehicle sales in the region, up from 3.8% in the previous quarter.
BYD's regional distributors include divisions of companies like Sime Darby, Bakrie & Brothers, Ayala Corp, and Rever Automotive, reassuring buyers in a region where Chinese car brands lack a track record. BYD is investing nearly $500 million in Thailand to build a new factory producing 150,000 EVs annually from 2024 for Southeast Asia and European markets.
BYD is focusing on brand building and EV education in markets like the Philippines and Indonesia, dispelling myths about range and ownership costs. In Indonesia, BYD secured a government contract for 52 EV buses for Jakarta through its partnership with Bakrie & Brothers.
With Thailand as its largest foreign market, BYD captures 24% of overseas sales there in Q2, while Tesla has less than 1% in Southeast Asia. BYD uses dealership and partnership models, diverging from Tesla's direct-to-consumer approach, and is innovatively engaging consumers through showrooms like "BYD by 1826" in Singapore.