Tesla’s Shanghai plant supplies south east Asia

Tesla has shelved plans to build a vehicle assembly plant in south east Asia, according to reports in Thailand.

Prime minister Srettha Thavisin last year announced Tesla was considering building an assembly plant in the country, after he held a series of meetings with the automaker’s top executives in the US and in Thailand. An announcement by Telsa for a US$5bn investment in the country was expected to have been made in the first quarter of this year.

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Local reports this week suggested the company had decided to focus only on establishing charging networks in the region for now. It currently supplies these markets from its plant in Shanghai, China, which has a production capacity of 1m vehicles per year and accounted for more than half of Tesla’s global output last year.

A Thai government source was reported to have said: “We are currently only discussing the expansion of charging stations with Tesla,” adding the automaker was “not proceeding” with plans to build factories in Thailand and in other countries in the region, choosing instead to focus on its existing factories in the US, China and Germany.

Thailand wants to establish itself as a major international production hub for BEVs and has set a target for 30% of total output to be zero emission vehicles by 2030.

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The domestic BEV market has grown rapidly in the last two years, to exceed 49,000 units in the first half of 2024, driven by Chinese automakers such as BYD, Hozon, Great Wall Motors and GAC Aion. Several BEV plants are already up and running in the country, with more to follow in the next few years.

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Earlier this week, Hyundai Motor said its proposed BEV assembly partnership with a local contract assembler was given the green light by the Thai government with local assembly scheduled to start in 2026.

Tesla has also held talks with the Indonesian government in the last year but so far a decision to build a plant in the country has not been announced.