EV sales soar to 18% share as Thai car market edges up in 2025

Thailand’s automotive market in 2025 continues to show only a slight decline compared with 2024, but the outlook is improving, with annual sales expected to reach around 600,000 units, up from 570,000 last year.

The electric vehicle (EV) sector, however, is expanding prominently. In the first seven months of 2025, EV registrations reached 66,000 units, almost equalling the full-year total of 67,000 units in 2024. Attention is now on whether manufacturers can meet the government’s EV3.0 and EV3.5 support scheme conditions, which require local production to offset imports within set deadlines. The Excise Department is closely monitoring certain producers at risk of missing targets, requiring them to report monthly production and sales.

Pongsak Lertrudeewattanavong, Deputy Managing Director of MG Sales (Thailand) Co., Ltd., said MG was confident there would be no problem, with a target of 20,000 units for offset production, of which 10,000 units have already been completed. “Whether producers can meet the offset target depends on their production and marketing capacity. Those with strong sales need not worry as they already have a supporting market,” he said.

Regulatory Adjustments to Prevent Price War

Concerns that some manufacturers might fail to meet offset requirements prompted the National Electric Vehicle Board and the Excise Department to ease measures. These include extending EV3.0 deadlines under EV3.5, allowing producers to withdraw previously claimed benefits (including vehicles already delivered but not yet subsidised), and granting 1.5 times production credit for exports. This will accelerate offset fulfilment while also reducing the state’s subsidy burden, since exported units will not receive the 150,000 baht per car support under EV3.0.

However, authorities are wary that if all manufacturers push to produce but hold back from exporting, the domestic market could face an oversupply, sparking aggressive price competition. “Consumers may benefit from lower prices in the short term, but in the long term a price war is not healthy for the industry. Allowing export credits helps stabilise the market,” said Pongsak.

EV Market Share Rising to 18%

A senior automotive industry source revealed that with 66,000 registrations in the first seven months, EVs now represent 17.7% of the total market, up sharply from 11.4% in 2024. With continued growth, EVs could exceed a 20% market share in 2025, helping improve overall car sales.

The growing popularity of EVs stems from improved consumer confidence, which was once a major barrier, coupled with wider model choices, more dealers, and high fuel prices. EVs are now more affordable than many internal combustion engine cars and benefit from lower maintenance costs.

Sales are expected to accelerate towards year-end as consumers rush to buy before subsidies expire. From 2026, the EV3.0 subsidy of up to 150,000 baht per unit will end, and excise tax will rise from 2% to 10%, likely driving prices up. At the same time, production technology improvements and government support have lowered EV costs, making them more accessible.

If state support is withdrawn, EV prices will inevitably rise, putting pressure on consumers and producers alike. To ease this transition, the government is maintaining stability by offering flexible measures — including export credits, deadline extensions from EV3.0 to EV3.5, and the right to review previous subsidy claims — to balance growth with market sustainability.

BYD, Neta Face Pressure to Ramp Up Offset Production

For the EV offset production scheme, manufacturers with high sales volumes are the ones to watch, as larger sales mean higher offset production obligations. Since 2022, when the EV3.0 scheme began and the Thai EV market boomed, Neta and BYD have stood out. In the first year, Neta topped the sales charts, but BYD has since taken the lead and continues to dominate.

Neta, which has already halted its contract manufacturing line, still faces scrutiny from the Excise Department because it has 19,000 cars left to produce as offset. In theory, meeting this target by 2025 seems unlikely. However, since the EV3.0 programme runs until 31 December 2025, the government can only monitor the situation closely, particularly as Neta’s Chinese parent company has secured new partners and may soon relaunch operations aggressively.

BYD, meanwhile, is seen as more secure due to its consistent sales growth and clearer business strategy. The company has invested heavily, including building a large factory on 600 rai in Rayong, officially opening its production line on 4 July 2024. The plant now employs 6,000 staff.

BYD has been the EV market leader since its launch and currently ranks fourth in Thailand’s overall car market, behind Toyota, Isuzu, and Honda, with an 8% market share. This success leaves BYD with the heaviest offset obligation.

BYD Prepares to Export in September

A BYD source confirmed the company must offset 30,000 imported cars. Some were produced in 2024, but a significant portion remains this year. BYD noted that producing only for the domestic market is challenging, even with growing demand.

The government’s eased measures, especially the ability to count exports towards offset at 1.5 times, are therefore welcomed. This flexibility simplifies business planning and strengthens Thailand’s position as a global automotive hub. From the outset, BYD designed its Thai plant as an export base for right-hand drive vehicles, part of a wider investment plan totalling 30 billion baht across nine projects.

However, to meet offset obligations on time, BYD believes right-hand drive exports alone are insufficient. The parent company in China has therefore adjusted its plans to add left-hand drive production in Thailand and is seeking new markets to absorb exports. From September 2025, vehicles from BYD’s Rayong factory will begin shipping abroad. BYD is confident this will allow it to meet EV3.0 requirements.

“This is a good direction — if exports weren’t allowed, the entire output would flood the domestic market, triggering fierce competition and distorting the market structure,” the source said.

Finance Ministry Aims to Prevent Market Glut

Kulaya Tantitemit, Director-General of the Excise Department, stated that easing EV3.0 and EV3.5 rules gives manufacturers more options while preventing oversupply that could trigger price dumping.

So far, no carmaker has requested an extension for offset production, though applications are open until December 2025. Apart from Neta, no other brand is currently considered at risk.

Narit Therdsteerasukdi, Secretary-General of the Board of Investment (BOI) and EV Board secretary, explained that extending offset deadlines effectively transfers shortfalls from EV3.0 to EV3.5. Carmakers must apply through the Excise Department, and several are already preparing to do so before year-end.

The EV Board’s updated rules aim to enhance EV3.0 and EV3.5 efficiency, improve oversight of subsidies, and align registration timelines with practical operations. They also provide manufacturers greater flexibility in business planning — a key step towards making Thailand a regional and global EV production hub under the government’s 30@30 policy (30% of production to be EVs by 2030).

This flexibility is especially important as the global EV market continues to face volatility in demand, technology, and geopolitics.