BYD Intensifies Push in Southeast Asia, Japanese Manufacturers Must Be Wary

KatadataOTO – The glory of Japanese automotive producers in Indonesia is starting to be disrupted by the presence of manufacturers from China. One of them is BYD.

The brand offers a number of electric car models at competitive prices, often even matching similar conventional engine car models.

In its home country, the automotive industry is experiencing fierce price competition. Thus, market expansion to other potential countries like Indonesia has become a way for Chinese brands to survive.

This was revealed by a Japanese representative from the consulting firm Alix Partners. He highlighted that BYD's sales in Southeast Asia have skyrocketed as they seek new markets amidst the heated price war in China.

Photo : Carnewschina

As a result, the arrival of BYD and various other Chinese car brands is slowly shaking the dominance of Japanese manufacturers in the country through 'cheap' cars.

“The low vehicle prices that are a strategy for Chinese brands are very suitable (to be applied) in the Southeast Asian market,” said Tomoyuki Suzuki, Japan Leader of Alix Partners, quoted from Nikkei Asia on Thursday (03/07).

He also said that a number of Southeast Asian countries like Indonesia and Thailand are aggressively building EV (Electric Vehicle) infrastructure such as public electric vehicle charging stations (SPKLU).

Electric cars are considered an important issue in related countries, especially Indonesia. Several policies have been launched by the government to accelerate the adoption of environmentally friendly vehicles.

“Strengthening relationships with countries like Indonesia, which have battery materials including nickel and cobalt, is consistent with China's economic regulations,” said Tomoyuki.

On the other hand, Japanese manufacturers are slowly seen shifting their focus to markets like India and Oceania with minimal investment.

Undeniably, Japanese brands need to start being cautious. According to Tomoyuki, there are several things the producers from the land of the rising sun can do.

Photo : Denza

For example, continuing to strengthen their hybrid car sales portfolio as their strength, rather than forcing competition with cheap Chinese cars.

Then, together with the Japanese government, there needs to be a commitment to support the development of EV infrastructure in Southeast Asia.

“Japanese manufacturers must also maintain their brand strengths, namely low operational costs and high resale value,” Tomoyuki emphasized.