From drinks to cars, Chinese brands take over Southeast Asia

BANGKOK, HANOI — Tana-wat, 34, an office worker who works in central Bangkok, starts his morning by turning on his BYD Atto 3, a Chinese electric vehicle (EV). On his way to work, he stops for a 20-baht ($0.60) lemonade at Mixue, a low-cost beverage chain from China. When he has a spare moment, he scrolls through TikTok, a Chinese short-form video platform, and clicks links at the bottom of videos to shop on TikTok Shop.

His daily routine is surrounded by Chinese brands, known colloquially as "C-brands."

Just a few years ago, C-brands were synonymous with “cheap” in Thailand. The picture has now changed dramatically. Their reach has expanded from inexpensive food and beverages to high-end fashion and cutting-edge electric vehicles.

Chinese companies’ expansion into Southeast Asia has moved beyond large-scale infrastructure investment and manufacturing and into consumers’ everyday lives.

C-brands on every floor of luxury malls

At Iconsiam, one of Bangkok’s most upscale shopping malls, C-brands are found on virtually every floor. Among them are Urban Revivo, a fashion brand; Pop Mart, which sells the popular Chinese Labubu toys; and electronics maker Xiaomi.

Chagee, a premium Chinese tea brand, occupies a prime spot on the first floor, where only luxury and premium brands are typically allowed. Its lighting and interior design make the store resemble a high-end luxury boutique.

A cup of Chagee milk tea costs around 120 baht. That is not cheap by local standards, where many beverages sell for around 20 baht, yet the store was packed with customers.

“Initially, most of our customers were Chinese, but now Thai customers of all ages and genders come in,” said Chanya Phosri, 38, a Chagee employee. “Whenever we launch merchandise through collaborations with celebrities or animation characters, long lines form before opening.”

Nepim, a 20-year-old university student waiting for her order, said she became curious about Chagee after seeing photos of its stores posted on Instagram.

“Chinese brands such as Labubu and Xiaomi are already familiar to us, so I don’t have any particular resistance to them,” she said.

Chagee has been rapidly expanding across Southeast Asia, operating more than 30 stores each in Thailand and Indonesia and 217 in Malaysia.

C-beauty also gaining ground

Chinese beauty brands are also gaining momentum.

At beauty retail stores in Bangkok’s Union Mall, Chinese beauty brands such as Judydoll stood out among the products on display.

A Thai woman shopping at the mall said the “Chinese sister” makeup style has recently become popular in Thailand.

“Chinese-style makeup is quite glamorous and is trending in Thailand these days,” she said. “I tend to try different cosmetics anyway, so I’ve also become interested in Chinese beauty products.”

Chinese companies have also taken a commanding position in Southeast Asia’s e-commerce market.

The region’s top three e-commerce platforms are Shopee, TikTok Shop and Lazada, all of which are within the sphere of influence of Chinese capital. Shopee is a Singapore-based company, but Chinese technology giant Tencent is among its major shareholders.

TikTok Shop has grown particularly rapidly. Its annual gross merchandise value in Southeast Asia surged from $4.4 billion in 2022 to $45.6 billion last year, an increase of more than tenfold.

These platforms serve as a direct bridge connecting C-brands with Southeast Asian consumers.

Chinese EVs taking over roads once dominated by Japanese cars

In Bangkok, taxi driver Apith, 48, sold his gasoline-powered Toyota last year and switched to an Aion electric vehicle made by Guangzhou Automobile Group (GAC).

“I prefer Japanese cars, but Chinese EVs offered significant discounts and lower fuel costs, so I decided to switch,” he said. “Overall, I’m satisfied with the interior design and convenience features.”

Thailand, home to production facilities operated by Toyota and Honda, has long been known as a stronghold of Japanese automakers, with consumers showing strong loyalty to Japanese cars.

But the shift toward electric vehicles is rapidly changing the market. Chinese brands including BYD, GAC and Changan now account for about 80 percent of Thailand’s EV market, shaking up the established order.

Thailand is not alone.

Hoang Thi Ha and Pham Thi Phuong Thao, researchers at the ISEAS-Yusof Ishak Institute, a Singaporean think tank, wrote that Vietnam had long been a representative case of the relatively weak influence of China’s soft power in Southeast Asia, but that “a quiet shift” has recently been taking place.

“Chinese lifestyle brands, which combine trendy designs with reasonable prices, are becoming increasingly popular among young Vietnamese,” they wrote.

In Indonesia, a joke has emerged that “whenever a vacant storefront appears, Mixue moves in.”

The number of Mixue stores in Indonesia surpassed 2,600 last year, reflecting the chain’s rapid expansion. TikTok Shop has also moved to strengthen its position in the country’s retail market by acquiring a 75 percent stake in Tokopedia, Indonesia’s largest homegrown e-commerce platform.

Even Indonesia’s longstanding anti-Chinese sentiment appears to be weakening in the face of C-brands’ powerful combination of value for money and financial resources.

Governments across the region are struggling to respond to the influx.

Vietnam has sought to nurture its EV industry around domestic automaker VinFast to prevent Chinese companies from taking the lead in the market.

Thailand recently scrapped duty-free treatment for ultra-low-priced Chinese goods.

Indonesia has introduced a 40 percent local content requirement, known as TKDN, for electric vehicles and plans to raise the requirement to 60 percent in 2027.

Despite these measures, analysts believe that government efforts will be insufficient to reverse the broader trend of Chinese brand expansion.

“C-brands have rapidly improved their quality and technological capabilities, while also developing the cultural appeal needed to shape consumer trends,” an industry official said.

“We are seeing the paradoxical situation in which wariness toward China is growing at the same time as acceptance of Chinese brands in everyday life.”

Noranit Visonyabut, a senior researcher at the Thailand Development Research Institute, said Chinese companies have the advantages of enormous economies of scale, extensive supply chains and government policy support.

“Companies in Thailand and other ASEAN [Association of Southeast Asian Nations] countries will find it difficult to gain an advantage through price competition,” he said.

He urged governments to focus not on protecting every industry, but on building competitive capabilities in selected sectors where they can realistically establish an advantage.

This article from the Hankook Ilbo, the sister publication of The Korea Times, is translated by a generative AI system and edited by The Korea Times.