On July 15, Cambodian Prime Minister Hun Manet posted on X, formerly known as Twitter, that he had met with Liu Xueliang, CEO of BYD Asia Pacific Auto Sales Division, and claimed that BYD would build a 20,000-unit capacity factory in the country. The tweet follows a previous announcement on June 27 by Hun at a small and medium-sized enterprise day held in the Cambodian capital, Phnom Penh, that BYD would open an assembly plant in Cambodia in the near future.
The announcement of a plant in Cambodia comes months after BYD’s expansion into Vietnam hit trouble. In May 2023, the Vietnamese government announced that BYD would be building a plant in Phu Tho province to produce EVs, but it is believed that this plan was put on hold in favor of a plant in Indonesia.
If the reports are correct, the decision to put on hold a plant in Vietnam but go ahead with one in Cambodia seems a strange decision. First off, sales of electric vehicles were only recorded in Cambodia for the first time in 2020 when sales were all of five units. This increased to 63 in 2021 before hitting a peak of 663 in 2022 before sales reduced to 604 last year. The term electric vehicles in this data include not only four-wheeled vehicles but also those with two and three wheels.
As of February this year, the total number of electric vehicles registered in Cambodia was 1,887, of which 906 were four-wheeled. Public charging infrastructure amounts to 18 charging stations. The “Electric Vehicle Development Policy (2024-2028)” forecasts the number of electric vehicles (four-wheel) to increase to 30,000 by 2030, of which 25,000 will be cars.
Various Chinese media outlets are gushing about the potential of the Cambodian market, quoting various Cambodian politicians. Sun Chanthol, Cambodia’s Deputy Prime Minister, in October 2023, speaking to BYD’s vice president, said, “We can supply the Greater Mekong Subregion (GMS) – a huge, potential market in six countries including Vietnam, Laos, Cambodia, Myanmar, and Thailand.” What Sun seemed to be forgetting is that BYD already has a plant in Thailand with a capacity of 150,000 and is also building a plant in Indonesia. Plans call for the Indonesian factory to start production in early 2026, and it will also have a capacity of 150,000 cars.
Against this background of a limited market in Cambodia and better-placed BYD factories elsewhere for export, the prospects for the Cambodian factory do not look particularly good.
2023 saw a total of 33,683 cars sold in Cambodia, according to data from Focus2Move, a market intelligence company. That was a nearly 11% year-on-year increase. There are currently six car assembly plants in Cambodia. In Hun Manet’s speech in June, he reportedly also mentioned that Ford, Toyota, and Hyundai had decided to set up car assembly and production plants in Cambodia.
BYD initially entered the Cambodian market in 2020, and this year, two new stores opened in Phnom Penh. There are currently ten international companies selling new energy vehicles in the Cambodian market, including BMW, Tesla, and Toyota, along with from China, Hongqi, Wuling, and GAC Aion, in addition to BYD.
BYD, however, has established market leadership and, in the first half of 2024, sold 658 cars, more than 40 percent of the 1,614 electric cars sold during the period.
To put the alleged plan for Cambodia in context against Vietnam, car sales in Vietnam were 404,294 units last year. EVs are believed to have made up about 6% of the sales, and BMI Research forecasts a compound annual growth rate of 26% between now and 2032, meaning an estimated market of 65,000 vehicles per year by 2032.
Editor’s note:
It should be noted that BYD has not made any announcement about a Cambodian plant. Until more details are known, we remain highly skeptical about the plan and its likelihood of seeing a factory that reaches production.
Further casting doubt on the whole plan is that Cambodia notoriously has some of the highest electricity prices in the region for both domestic and industrial users. The country suffers from problems producing enough electricity to meet demand and with the infrastructure to deliver it.
Vietnam, in terms of market size, growth projection, and infrastructure, is a far better location for a BYD factory than Cambodia.
Sources: X, Khmer Times, Finance Associated Press, Yiche, Pandas go to sea, Focus2Move, Khmer Times,
