The ongoing price wars and uncertainty surrounding insurance coverage for electric vehicles serve as reminders that Thailand's EV industry is still in a transitional stage. However, these challenges should not deter the nation from its path towards an electric future.
It is widely accepted that the future of automobiles is electric. Industry giants, including Goldman Sachs, predict that EVs could make up nearly half of global car sales by 2035.
Despite this optimistic outlook, recent trends indicate a temporary slowdown in the international market.
EV sales in Europe dropped by 11% year-on-year in March, according to Bloomberg. In the United States, EV sales in the first quarter remained flat, as some automakers adjusted their EV strategies or laid off personnel.
Analysts, however, believe this decline could be temporary, merely a "blip" as the market anticipates the next growth impetus.
In Thailand, local operators remain optimistic about the growth prospects of the Thai EV market. Government policies offering various incentives to stimulate domestic demand for EVs and attract automakers to open production lines here have been effective.
Last year, domestic sales of EVs skyrocketed by 603% year-on-year to more than 73,000 units. The Federation of Thai Industries is confident this growth will continue, if not strengthen, in the coming year.
With the domestic market growing steadily, one major part of Thailand's dream to become the regional hub of EVs is being fulfilled.
For the other part, manufacturing, the government has set a goal for zero-emission vehicles to comprise 30% of total car manufacturing by 2030.
Thailand can capitalise on its well-established supply-chain networks, logistics and skill base developed from being one of the world's manufacturing bases for internal combustion engine (ICE) vehicles. This production goal is thus seen as attainable.
According to the Board of Investment, auto giants including Toyota Motor Corp of Japan, as well as Great Wall Motor and SAIC Motor of China, have signed up for a government incentive plan to promote EV sales and production in Thailand.
Thai entrepreneurs are already building electric buses, boats and tuk-tuks while developing a vast network of charging stations.
Concerns about climate change and CO2 emission standards make the case for EVs and zero-emission vehicles even stronger.
The electric transformation, with its far-reaching sweep and rapid pace, demands vast changes not just to the auto-making industry but also the infrastructure and environment that has supported fuel-burning automobiles for more than a century.
There is no question that every player -- the government, businesses and consumers looking for new opportunities amid the transition -- must quickly adapt to the changing environment.
The price cuts and insurance business uncertainty reflect the nature of this new industry driven by fast-paced technology.
While regulators must ensure that legal frameworks are adequate and stringent to guard consumers against unfair practices, business operators would do well to anticipate the impacts from the change and develop measures to maintain customer confidence.
Industry leaders may have differing opinions on whether these difficulties, including reluctance by banks to provide auto loans, will slow down the EV acceleration. However, they should all agree that these issues should not cause anyone to lose sight of the future.
As electrification gains speed, the industry faces not just immediate adaptations to price fluctuations or the possible demise of the secondary market for used cars but also larger, fundamental questions.
These include ensuring an adequate clean power grid, balancing vehicle sales growth with creating infrastructure particularly charging stations, battery recycling capacity and future road construction that may need to accommodate self-driving vehicles or be embedded with charging mechanisms allowing EVs to recharge on the move.
Phasing out the ICE production and people employed in the sector must also be done carefully to minimise disruptions.
Indeed, the nature of EVs, which can become obsolete and lose value in the second-hand market, may disrupt the current sales model altogether, with renting becoming a preference and personal car insurance potentially becoming unnecessary. But these can present opportunities for discerning entrepreneurs to invent new businesses such as ride-sharing, EV repair or modifying centres.
Thailand's journey towards becoming a regional EV hub is just beginning, and while the road may be fraught with challenges, the destination promises a cleaner, more sustainable future for all.