Chinese automakers have pledged roughly $17.7 billion of investment in the ten ASEAN countries between 2021 and 2026, according to Sun Xiaohong, former secretary-general of the automotive internationalisation committee at the China Chamber of Commerce for Import and Export of Machinery and Electronic Products. Speaking at the Taida Auto Forum on September 20, Sun said the figure is nearly as large as the $15 billion China earned from exporting about 990,000 cars to ASEAN in 2025.
Sun, cited by Chinese outlet D1EV, described the next phase of China's auto going-global push with the phrase "stand firm, come back" - meaning automakers must build durable local operations and generate returns that can fund home-market R&D, rather than chasing short-term sales volume.
Investment surge, uneven landing
Chinese investment in ASEAN has moved through three stages, Sun said. From 2010 to 2014, companies tested the waters with light assets, investing about $500 million. From 2015 to 2021, a merger-and-acquisition phase saw GWM buy GM's Rayong plant in Thailand, with total investment of $2.85 billion. Since 2022, the pace has exploded: CATL, BYD and others have committed $13.8 billion, accounting for 80 percent of cumulative investment.
Two markets absorb most of the money: Indonesia takes 36 percent and Thailand 32 percent. By value chain, complete vehicles account for 54 percent of investment, power batteries 34.5 percent and components the rest. About 180 Chinese parts suppliers have already set up in Southeast Asia.
Yet investment does not equal a secure foothold. Thailand is the clearest example. Under the EV3.5 policy, for every imported car a company sells in Thailand by 2027, it must offset that with three locally produced units. In May, ten Thai industry associations jointly petitioned the government to sharply raise import duties on finished vehicles, worried about what they call an "industrial cliff" - the risk that factories and local supply chains built for the policy cycle could be hollowed out once incentives end.
Indonesia pressures are just as visible. The country's localisation rate target rises from 40 percent in 2026 to 60 percent in 2029 and a hard 80 percent by 2030. Jakarta also differentiates by battery chemistry: nickel-based batteries enjoy full tax benefits, while LFP (lithium iron phosphate) and other non-nickel packs get sharply discounted incentives. Sun quoted a local saying: "Read policy ten steps ahead, plan five steps, but act three steps" - a warning that companies cannot build long-term plans on today's rules.
Price wars and policy risk
Market-side problems are also surfacing. Chinese brands have long relied on price cuts to win share in Southeast Asia. In September, China's commerce, industry and market-regulation ministries jointly issued overseas compliance guidelines for automakers; six of the seven competition-behaviour rules concern pricing. Sun said that in Thailand, three-year residual values for Chinese brands average about 56.8 percent, but some heavily discounted models now sell new at or below what their three-year-old used values should be. In extreme cases, he said, some brands have seen local after-sales and warranty systems collapse.
"Price competition has no future," Sun said. Moderate price wars can open markets, but if low prices do not build stable market position, brand trust and service networks, they turn overseas markets into one-off business.
ASEAN is not a unified market despite its free-trade framework. Each country has its own certification, consumption taxes, quotas and licences, and localisation rates are calculated nationally. Treating Southeast Asia as one big market and replicating the same capacity everywhere is unrealistic, Sun argued.
He forecast that China's commercial-vehicle exports could reach 1.5 million units in 2026, with passenger-car exports targeting more than 10 million. But he stressed that quantity is not the goal; quality and sustainability are. Project completion rates vary widely - 76 percent in Thailand, about 40 percent in Indonesia and roughly 24 percent in Malaysia and Vietnam - showing that some markets are releasing capacity while others are still building.
The real questions for the second half of China's global push, Sun said, are whether investment converts into production, whether that production integrates into local industry, and whether local operations generate sustainable profits. If companies exit after a price war, even the largest investment figures will not secure China's long-term position in Southeast Asia.
