BANGKOK, THAILAND – A former European-funded industrial site in Thailand’s Rayong province now exemplifies Europe’s strategic missteps in Southeast Asia.
A manufacturing plant in Thailand’s Rayong province stands as a symbol of everything Europe has done wrong in Southeast Asia. Built with billions in support, it was once intended to roll out Opel models; today, a Chinese electric car manufacturer produces there. What sounds like a footnote is, in reality, symptomatic: Europe has simply not taken Southeast Asia seriously for decades. Now, it is paying the price.
China has long won the competition for electromobility, solar energy, and battery storage against Europe – and is now catching up in heat pumps. But the Middle Kingdom is not waiting for a European reaction. It is building complete value chains in Southeast Asia that Europe no longer needs.
The Plant That Never Was Opel
In 1996, General Motors established a factory in the Eastern Seaboard Industrial Estate of Rayong, modeled after the GM plant in Eisenach and supported by German taxpayer money. It never produced Opel models, but rather Chevrolet Zafira, Colorado, and Trailblazer. The Opel brand disappeared from the Thai market as early as 2003. In February 2020, GM withdrew, and the Chinese manufacturer Great Wall Motor took over the plant later that same year.
Today, the ORA Good Cat, a pure electric vehicle, rolls off the production line there. Great Wall Motor was thus the first Chinese automaker to locally produce all variants of new powertrains – hybrid, plug-in hybrid, and battery-electric – in Thailand. An industrial location subsidized with European funds is now driving China’s expansion in Southeast Asia. The failure could hardly be more aptly summarized.
Hard Drives, Bicycles, Field Plates – Europe Looks Away
The ignorance towards Southeast Asia has a long history. For decades, countries like Thailand, Vietnam, or the Philippines were considered by German companies at best as cheap holiday destinations or low-cost production sites. Few noticed that almost all hard drives from well-known brands had long been coming from Thailand or the Philippines. The IBM plant in Mainz was closed in 2003, with the division moving through Hitachi to Western Digital, which now produces in Rayong.
The demand from AI data centers for hard drive capacity thus bypasses Europe entirely. The same applies to bicycles: numerous brands have long been producing in Cambodia without causing concern in Germany. Europe has simply viewed Southeast Asia as an extended workbench – as China’s successor for cheap production, not as an independent market of the future. Exactly the same mistake is being made again.
Chinese E-Cars Chomp at Toyota’s Market Share
Thailand ranks tenth in global automotive production. For a long time, Japanese manufacturers dominated with over 90 percent of the market. This is changing rapidly. According to the Federation of Thai Industries, nearly 32,000 electric cars were sold in January 2026 alone – four times more than in the same month the previous year, and three times more than internal combustion engine passenger cars. In the first quarter of 2026, over half of all new registrations were electrified – battery-electric or hybrid. Chinese manufacturers account for over 90 percent of pure EV sales.
The IEA Global EV Outlook 2026 confirms this picture for all of Southeast Asia: Annual EV sales in the region more than doubled in 2025, with market share rising to nearly 20 percent. Thailand accounted for about a quarter of all new registrations, and Vietnam even more. This is roughly the level Europe holds – only that the EVs there come almost exclusively from China, not from Wolfsburg or RĂ¼sselsheim.
Vietnam Overtakes Europe, Thailand Catches Up
In Vietnam, the market turnover has been even faster. In the first quarter of 2026, the share of electrified vehicles reached 42.8 percent – the highest figure among all ASEAN states. This is driven by VinFast, the domestic manufacturer, which, with a market share of over 42 percent, is now the undisputed number one in the Vietnamese automotive market. Vietnam has thus achieved something Germany is still working on: building a functional own electric car manufacturer – and in a fraction of the time.
The IEA forecasts for Southeast Asia that the EV share could rise to up to 60 percent by 2035, driven by favorable price developments and political frameworks. Several countries, including Vietnam, have already announced they will expand their subsidies as a direct response to the Middle East conflict and the resulting rise in oil prices. The energy crisis is driving e-mobility in Asia forward faster than any regulation could have.
ACFTA 3.0: China Sets the Rules
In October 2025, China and the ten ASEAN states signed version 3.0 of their free trade agreement at a summit in Kuala Lumpur. Negotiations had already been completed in May 2025. The agreement now covers not only traditional customs issues but also the digital economy, green industry, supply chain standards, and technical regulations – precisely the areas where the EU had previously seen its leading role.
China’s Premier Li Qiang summed it up at the summit: Closer regional cohesion could overcome global uncertainties. The message to Washington and Brussels was unmistakable. The bilateral trade volume between China and ASEAN already amounts to 771 billion US dollars annually. China has long been the region’s most important trading partner – far ahead of the EU. With ACFTA 3.0, this lead is being codified in rules that Europe did not help write.
What Europe Still Has – And How Quickly It Can Disappear
In Thailand’s EV offerings, the EVAT association lists 85 fully electric models: 48 come from China, and 18 from Germany. On paper, this sounds solid. In practice, over 90 percent of sales go to Chinese models. In Bangkok, it is now heard that a German product must be inferior at the same price – because costs in Germany are so much higher. An image problem that no new model can solve.
In the area of heat pumps, Europe still holds a lead – but it is shrinking. China already produces the lion’s share of global solar panels, inverters, and battery storage today, and Germany’s reaction to the climate competition, according to surveys, currently consists of rejecting climate protection targets. Those who bow out of the race in this manner should not be surprised if Southeast Asia one day no longer needs European products – not because they have been banned, but because better ones are available.