Tesla cancels factory plan in ASEAN

Tesla has scrapped plans to build plants in the ASEAN countries, reported Thai newspaper the Nation.

Quoting an anonymous official source, the Nation said last week that Tesla had pulled out the team overseeing the project late last year.

Tesla is currently only discussing charging stations, with the factory plans suspended not just in Thailand but worldwide.

"They are not proceeding in Malaysia, Indonesia, or anywhere else except for China, America, and Germany," said the source.

EV sales in Southeast Asia are expected to hit between $80 billion and $100 billion by 2035, from about $2 billion in 2021, according to a January report by EY-Parthenon, the strategy consulting arm of Ernst & Young.

Southeast Asia has become a hot destination for Chinese carmakers including BYD, Aion, Neta as well as SAIC Motor, with some of them already producing vehicles locally.

While the ASEAN region has the potential for a vibrant EV market, it is currently dominated by Chinese companies have a strong grip on the sector and offer cars at a cheaper price than Tesla.

During an earnings call last month, Tesla told investors that its profits have nearly halved due to extreme competition from other EV makers.

Malaysian Prime Minister Datuk Seri Anwar Ibrahim said Tesla's decision was not a result of his country's performance or polices, according to the Malay Mail. Instead, he said it was down to fierce competition from Chinese rivals.

Tesla cars being sold in Malaysia and other parts of Southeast Asia are primarily imported from its factory in Shanghai.

After a brief lead in 2023, Tesla now ranks second to BYD, which has been leading the EV market in Malaysia, selling over 8,000 units since last year – 3,000 more than Tesla.