Can't refuel anymore! Chinese electric cars are selling wildly in Southeast Asia and Australia, and the Thai Prime Minister has switched to BYD.

Ask AI · Why are Southeast Asia’s EV sales surging while Europe responds slowly?

By Lin Keying, Guo Yifei

Edited by Yang Buding

Chinese-Australian Li Lin (pseudonym) has decided to buy a BYD.

She already has a fuel-powered car at home. But because fuel prices have risen sharply in recent days, she has started to worry that there may be an energy shortage in the coming period—“Maybe I won’t even be able to get gas.” She told Tencent Auto’s Long Range that there are not a few people with similar thoughts locally; in just one hour inside a BYD store, five or six deals were completed, with deliveries scheduled for at least a month later.

As the US-Iran conflict broke out at the end of February and continued to escalate, global energy markets were quickly thrown into a tense state. In the just-past March, the price of international Brent crude oil futures jumped 63%, recording the largest single-month increase since 1988.

An Australian Melbourne BYD salesperson told Tencent Auto’s Long Range that in his 4S store, BYD Waverley sold nearly 740 vehicles in March. “The store manager told us this set a monthly sales record for the entire Australian auto sales industry.”

The sharp rise in oil prices has begun to stir the global auto market. Official data shows that in March this year, BYD’s overseas sales reached 119,591 units, up 65.2% year on year.

On March 31, BYD Chairman Wang Chuanfu said at a communication meeting that exports have been doing well this year, especially as the situation in the Middle East has pushed up global oil prices. “In Australia, New Zealand, the Philippines, and other places, sales today are equivalent to what they used to do over the previous two weeks.” He judged that this round of oil price increases is expected to push BYD’s export sales to a new high again.

Xpeng Motors’ Germany manager Qian Kai also told Tencent Auto’s Long Range that in the first quarter of this year, Xpeng’s sales in Germany have already tripled year on year.

The impact from rising oil prices may be only just beginning.

Recently, Fatih Birol, Executive Director of the International Energy Agency, said on a program that the energy crisis triggered by the US-Iran conflict is the most severe one in history, and conditions in April will be worse than in March. He explained that in March, some oil and natural gas tankers that had already set sail before the war broke out were still arriving at ports, but by April there will be no oil to ship; at that time, the oil supply shortfall will be twice that of March.

Meanwhile, at local time on March 30, Iran’s Parliament’s National Security Committee passed a bill proposing to charge tolls for ships transiting the Strait of Hormuz, which also implies that high oil prices may last longer.

During this period, Tencent Auto’s Long Range has been continuously gathering information from auto-industry people in Europe, Southeast Asia, China, and multiple other regions. Multiple sources said that after oil prices rise, test-drive volumes and order volumes for Chinese electric vehicles in each market basically increase as well, but this growth is mainly affected by multiple factors such as promotional policies and market cycles. Whether Chinese automakers can gain a significant windfall from this round of oil price volatility remains difficult to conclude in the short term, but in the long run, rising oil prices are undoubtedly accelerating the global auto market’s shift toward electrification.

“Wealth” brought by war—can Chinese automakers in Europe afford it in the short term?

From February 23 to March 23, over one month, the average price of 95-octane gasoline in the 27 EU countries rose from 1.551 euros to 1.783 euros, an increase of 15%.

When oil prices move, it is often the used-car market—lower priced and quicker to deliver—that makes the first response in the auto industry.

Qian Kai told Tencent Auto’s Long Range that recently in Germany, demand for used electric cars has started to increase, while growth for new cars is usually slower.

According to data from Marketcheck, in March this year, the sales volume of used electric vehicles in the UK reached 131,559 units, up 17.6% month-on-month compared with the previous month, and market share rose from 15.06% in February to 15.45%.

A person in the German auto industry said that Germany is indeed discussing the issue of rising oil prices recently, but electric-vehicle prices are still relatively high, and electricity prices in Europe are also not cheap. “Overall, it certainly promotes electrification in Europe, but a sudden surge in the short term—I’m skeptical.”

Germany is one of Europe’s largest auto markets and one of the countries pursuing energy transition more aggressively. In 2024, about 62.7% of Germany’s electricity comes from renewable energy, and coal power is about 22.5%. However, because the cost of energy transition is high, Germany’s electricity prices have remained elevated for the long term. Data from the German Energy and Water Industry Association shows that in 2024, the residential electricity price in Germany was about 40.92 euro cents per kWh (about RMB 3.13 yuan), placing it among the top in Europe. This means that even if oil prices rise, electric cars’ cost advantage in Germany is not very obvious.

Qian Kai said that in Germany, Xpeng Automobile’s orders in the first quarter grew threefold year on year. But at the same time, he said that Chinese electric vehicles are still in a growth stage in Europe, so “it’s hard to say how big a role the Middle East situation plays in all this.”

Most Chinese auto brands entered Europe around 2021. Now more than five years have passed. But Europe is inherently a challenging market; the local auto-industry ecosystem is very different from China’s. Local brands such as BBA have strong roots, making it difficult for automakers to build brand awareness. In addition, the pace of electrification transition in Europe has also slowed somewhat in recent years. As a result, Chinese automakers basically are still exploring and trying as they go forward.

EU-EVS data shows that as of March 29 this year, EV sales in the UK in March reached 58,517 units. BYD sold 3,252 units, accounting for about 5.6% and ranking fifth. But even so, the overall market volume of Chinese brands in Europe remains limited.

A person engaged in overseas-market compliance for automobiles said that local oil prices in Europe have indeed risen significantly, but Chinese-brand sales are still small. Most new-energy-vehicle players are still in the stages of building their channel, after-sales, and compliance systems, “and there’s a very high likelihood they can’t handle the traffic generated by this war.”

In February, BYD’s new-car registrations in the European market grew 162% year on year. Its market share rose from 0.7% in the same period last year to 1.8%, again surpassing Tesla. BYD’s European sales for March have not yet been announced.

The compliance professional mentioned above told Tencent Auto’s Long Range that the increase in BYD’s sales is driven more by promotional factors, and this is also the first time it has publicly run a clearance-promotion campaign in Germany. “Basically, they’re selling at a price that’s a loss, and it also helped spark a wave of purchase interest among Chinese consumers for electric cars. We almost bought two ourselves. But later, we considered that there might be plenty more deals like this, so we decided to wait.”

In February, Lars Bialkowski, head of BYD’s Germany operation, had said that the target was to achieve 50,000 new car registrations by the end of this year. According to the German Federal Motor Vehicle Transport Authority, in 2025 BYD’s new car registrations in Germany were projected to be 23,306 units, meaning this year’s sales will need to double.

Thailand’s Prime Minister switches to BYD—EV sales in Southeast Asia explode

Compared with the European market, changes in oil prices in Southeast Asia transmit faster and more directly.

On March 23, the Bangkok Motor Show officially opened, and more than a dozen Chinese automakers occupied nearly half of the exhibition hall. As of March 29, MG sold 4,217 units, and Chery’s OMODA&JAECOO sold 3,984 units. Among the automakers whose order volumes at the show had been announced, they ranked second and third respectively, behind Toyota’s 5,672 units. Order volumes for brands such as Changan, Geely, Chery, Great Wall, GAC, and others were also all over 2,000 units. BYD had not yet disclosed its order numbers.

A Chinese auto-brand Thailand general manager told Tencent Auto’s Long Range that influenced by both promotions at the auto show and rising oil prices, retail sales of their brand in March doubled month-on-month.

Southeast Asia is one of the earliest regions where Chinese automakers expanded overseas. Over the past two years, brands such as BYD, Great Wall, Changan, GAC, and Chery have successively built factories and made arrangements in Thailand, Indonesia, Vietnam, and other places. When Yan Feng (pseudonym), who is responsible for Southeast Asia marketing at the company, traveled to Thailand for business in March, he found that there were clearly more Chinese brand cars on the local streets—BYD, Changan, MG were everywhere, and even Aion could be found among ride-hailing vehicles. “It’s almost like back home.”

Unlike Europe, in Southeast Asia, simultaneous “oil-and-electric price hikes” are rarely seen during geopolitical conflicts. Instead, local electricity prices are relatively stable, while oil prices are more sensitive to international markets. This causes the gap between oil and electricity prices to widen rapidly during conflicts, making EVs’ economic advantage easier to show.

Take Thailand as an example. Its power generation structure is dominated by natural-gas power, accounting for nearly 60%. The cost of natural-gas power generation is relatively stable, which keeps Thailand’s electricity prices low over the long term. Starting in 2025, Thailand will adjust the basic electricity tariff to 4.15 Thai baht (about RMB 0.87 yuan), far below electricity prices in Europe.

At the same time, rising oil prices continue to widen the oil-electricity price gap. On March 31, Thailand’s price of 95-octane gasoline reached 42.05 Thai baht per liter (about RMB 8.82 yuan per liter), up 38% compared with early March—making the cost advantage of electric vehicles even more prominent.

In March, when Yan Feng was on a business trip in Thailand, he found that refueling had become difficult. “You might not be able to get fuel even after going to two or three gas stations.” He believes this kind of lived experience will reinforce consumers’ attention to electric vehicles, and from an expectations standpoint, it is a positive.

A top dealer in Malaysia also told Tencent Auto’s Long Range that after oil prices rose, the number of customers coming to the store to test-drive electric cars increased noticeably. “You could say it’s up by multiples; order volume is also up by at least one full time. We still have a pretty optimistic outlook for the future market.” However, he also said that domestically produced fuel cars are hit less because their fuel consumption is relatively low and their prices are more affordable, and the government also subsidizes fuel prices.

Even though market sentiment is warming up, Southeast Asia still faces a scale ceiling. Yan Feng said that Thailand’s annual auto sales are about 600,000 units, and Chinese brands account for roughly 22%, or around 130,000 units. Meanwhile, at present, Chinese automakers’ designed production capacity in Thailand is about 600,000 to 700,000 vehicles, but actual utilization is only about one third.

“Even if Thailand grows, for Chinese automakers, this volume still isn’t enough,” he said.

In addition, infrastructure remains one of the limiting factors. An overseas-market professional from a Chinese brand said that electric vehicles rely on charging networks. Under the current global economic environment, large-scale construction of charging infrastructure in Southeast Asian countries still faces funding pressure. Therefore, hybrid and plug-in hybrid models may have more practical opportunities.

More important than the short-term sales growth is how this round of oil price increases is pushing energy transition in different countries. Recently, Cambodia announced that it would reduce import tariffs on electric vehicles to 0 and issued related incentive policies. Thailand, Indonesia, Vietnam, and other countries have also rolled out electric-vehicle subsidies and tax-advantage policies in the past as well, to accelerate development of new-energy vehicles.

On March 24, Thailand’s government officially announced a 2 Thai baht per liter increase in gasoline prices. The next day, Thailand’s Prime Minister Anutin did not take his usual Rolls-Royce; instead, he took a BYD Sea Lion to the Parliament building. In interviews with the media, he suggested that the public should try electric vehicles more, saying they can not only reduce fuel costs but also achieve zero emissions.

“Local consumers’ awareness of electric vehicles has changed dramatically compared with before, and all of these will influence ordinary consumers’ choices when buying a car,” the aforementioned Thai brand general manager said.

The overseas-market professional mentioned earlier believes that breaking free from dependence on oil is a common demand among most non-oil-producing countries. This round of oil price increases provides an opportunity for Chinese automakers to promote new-energy vehicles. “Hybrid and pure electric are the most mature solutions right now, and for Southeast Asia, it’s also an opportunity for industrialization.”