Thailand, India Boost EV Investment in Southeast Asia

The electric mobility trend in emerging markets is gaining significant momentum, according to a report published by Temasek and LeadFrog Investments on September 20. The green-mobility capital demand of $1.3 trillion projected until 2030 outpaces other sectors in these markets, particularly evident in South Asia, where electric vehicles (EVs) have already achieved cost-effectiveness, convenience, and reliability. 
 
Private capital markets also hold potential for supporting low-income consumers' participation in electric mobility within some of the world's fastest-growing economies. Institutions looking to invest in the region’s expanding sustainable mobility ecosystem could find significant opportunities. 
 
"The opportunity is there. It absolutely exists, and we know the capital is there too," said Ed Northam, Macquarie Asset Management's Green Investments Head of Asia Pacific and global Head of Core Renewables. 
 
Among Southeast Asian countries, India and Thailand are presenting compelling opportunities for EV investment due to their innovative approach towards affordable electric mobility and an established automotive industry, respectively. 
 
India has shown strength through its innovative approach towards affordable two- or three-wheeler EVs, while Thailand leverages its established automobile industry to attract foreign investments, positioning itself as an EV manufacturing hub within the region. 
 
Thailand has become a key destination for international expansion among EV manufacturers since early 2022, attracting major Chinese companies like BYD and Changan by 2023 thanks largely to its well-established automotive industry dating back decades along with skilled laborers prepared for transitioning into EV production, making it attractive for businesses shifting towards this direction, according to Michael Glancy, Managing Director at JLL Thailand & Indonesia. 
 
Additionally, proactive policies offered by Thailand’s Board of Investment coupled with incentives from the Eastern Economic Corridor Office have played crucial roles in attracting foreign investments, recognizing it as a vital pillar within the Thai industrial sector and contributing significantly towards growth/expansion potential from manufacturers/suppliers related to this sector, including real estate demands such as logistics warehouses/factories, etc., which could greatly benefit from expanding the EV industry. 
 
Meanwhile, India has been at the forefront of affordable electric mobility solutions innovation, particularly in two- and three-wheeler segments. The report by Temasek and LeapFrog indicates that these vehicles have already reached price tipping points when considering lower running costs, maintenance charges, as well as subsidies provided for them. 
 
The investors predict that nearly half of India's two- and three-wheeler sales could be made up of EVs by 2030, given sufficient investment into infrastructure along with government support. Complementary businesses like Battery Smart delivering tech-enabled distributed solutions allowing quick/convenient charging options are accelerating EV adoption within this country. 
 
Macquarie Asset Management's Northam agreed on significant investment potential coupled with carbon emission reduction possibilities within the Indian EV market, especially concerning fleet electrification, stating, "We've created a business called Vertello set up to finance transition predominantly among fleet owners, mainly inter-city/intra-city buses, along with ride-sharing fleets moving from internal combustion engines towards electric vehicles." 
 
Highlighting the transport industry’s contribution accounting for about 15-20% of carbon emissions across the Indian economy, he added, “So we think that's a massive opportunity, and we've put our own capital behind that opportunity." This reflects growing investor confidence in emerging markets’ green-mobility sector, indicating a promising future ahead amidst the global push towards sustainable development goals.