Thai-Chinese joint venture SAIC Motor-CP, the manufacturer and distributor of MG cars, plans to spend 2.5 billion baht developing a factory to produce batteries for battery electric vehicles (BEVs) and start making BEVs domestically next year.
BEVs run entirely on batteries without any help from internal combustion engines.
MG is also conducting a feasibility study on a battery recycling facility as the number of used batteries is expected to increase, said Zhang Haibo, president of SAIC Motor-CP Co and MG Sales (Thailand).
"The EV industry is growing faster as new Chinese automakers launch more EVs to meet global demand," he said.
MG plans to spend 2.5 billion baht on factory construction and the development of technology, which will be transferred from its parent company in China.
"We already have a battery production facility for plug-in hybrid electric vehicles in Chon Buri, but we want to expand production capacity to produce BEV batteries to support exports," said Mr Zhang.
However, some countries such as Malaysia and Indonesia have a policy of not exporting raw materials for production of lithium-ion batteries in order to persuade companies to invest in their countries. This may pose a major challenge to the global EV industry in the future, according to MG.
By 2023, MG's car manufacturing plant in Thailand is expected to produce BEVs for both domestic and export markets, Mr Zhang said.
SAIC, or Shanghai Automotive Industry Corporation, has invested 10 billion baht in Thailand since 2013. It claims to have the highest investment value for a Chinese company in the Thai automotive industry.
The government is promoting the EV industry as part of its plan to reduce carbon dioxide emissions and cope with harmful levels of PM2.5 ultra-fine dust emitted from ageing oil-powered cars.
The National EV Policy Committee announced in March last year a goal to have EVs constitute 50% of locally made vehicles by 2030, part of a plan to make the country a regional EV production hub.
MG aims to sell 50,000 cars in Thailand this year, up from 32,000 units in 2021.