TAIPEI (Taiwan News) — Taiwan’s Ministry of Economic Affairs said Tuesday it is reviewing regulations to prevent China’s BYD Auto from entering the local market through indirect imports, CNA reported.
The announcement follows reports that BYD intends to import vehicles manufactured at its Thailand factory through local distributor Taikoo Motors Group — a strategy seen as an attempt to bypass Taiwan’s ban on the direct import of complete vehicles from China.
The ministry said it is drafting control measures that will apply to Chinese-branded vehicles entering Taiwan via third countries. These rules will cover imports, inspections, and sales, and are expected to be finalized by the end of the year.
Officials noted that vehicles assembled in Taiwan using Chinese parts must comply with existing government regulations before they can be sold. These rules are designed to prevent market dumping and require locally assembled vehicles to gradually increase the proportion of Taiwan-made parts to at least 35% within three years.
Some Taiwanese automakers have voiced concerns that Chinese government subsidies are driving down production costs for Chinese vehicles, enabling lower prices that could trigger a surge in indirect imports and threaten the domestic automotive industry.
The rise of Chinese carmakers in Southeast Asia is part of a broader trend. Since 2018, around 20 Chinese automotive brands have entered the Thai market. As of March, 165 Chinese-invested auto parts companies were registered in Thailand — a 3.4-fold increase since 2017.
Experts believe China is using Thailand as a strategic manufacturing base to expand into Asian markets. Japanese automakers, which have maintained a strong presence in Thailand since the 1960s, are now facing growing competition. They are supported by approximately 1,400 local suppliers and currently hold over 70% of the market share.
However, Chinese suppliers offer parts at prices up to 30% lower than their Japanese counterparts — a price gap that may pressure Japanese manufacturers to source more components from China to remain competitive.
