BRI partner countries exhibit distinct resource endowments, requiring Chinese smart automotive industrial chain enterprises to evaluate local factors such as policy frameworks, industrial infrastructure, labor conditions, and resource availability when expanding overseas.
Author: Haonan Chen
A PEST analysis (Political, Economic, Social and Technological) provides a systematic framework to assess the macroeconomic environment of target markets, enabling enterprises to determine their suitability as primary destinations for global expansion.
The report highlights the following BRI priority markets:
Asia: Indonesia, Thailand, Malaysia, South Korea and Turkey
Europe: Poland and Russia
Africa & South America: South Africa and Brazil
Supply-Demand Dynamics Define BRI Target Markets
Key Assumption: Chinese new energy smart vehicle industrial chain enterprises prioritize two dimensions when selecting overseas expansion destinations:
1. Supply-Side Considerations (Capacity Expansion):
Primary factors include the presence of a mature automotive manufacturing ecosystem and skilled workforce in the target country
Annual vehicle production volume serves as a proxy indicator to assess local supply chain maturity
2. Demand-Side Considerations (Product Exports):
Key focus is on market size potential to justify establishing sales/service networks with asset-light investments
Annual vehicle sales volume acts as a preliminary metric to evaluate market scale
Given the scope of this report, we first identify BRI countries with both high production and sales volumes as initial screening criteria, followed by detailed PEST analysis (Political, Economic, Social and Technological) for prioritized markets.
Indonesia, a pivotal player in Southeast Asia, is actively absorbing China’s manufacturing capacity while prioritizing green economic transformation. The country presents a strategic opportunity for China’s new energy smart vehicle industrial chain.
Indonesia is undergoing a pivotal mobility transition from two-wheelers to four-wheel vehicles, with per capita Gross National Income (GNI) exceeding USD 4,800, signaling rising consumer purchasing power. Concurrently, the country’s demographic dividends—including a workforce of 140 million and a median age below 30—create a labor cost advantage, indicating substantial future demand for new energy vehicles (NEVs) in its domestic market.
Additionally, Indonesia has annual vehicle production capacity exceeding 1 million units, a mature industrial manufacturing base, and plenty of nickel reserves—a strategic resource powering the electric vehicle revolution.
These factors position Indonesia as an ideal destination for Chinese NEV industrial chain enterprises to establish long-term capital investments and localized production hubs.
Thailand, a pivotal economy in Southeast Asia, demonstrates strong demand for green economic transition, with a vehicle ownership rate of 290 per 1,000 people, indicating significant potential for new energy vehicle (NEV) adoption and market growth.
Meanwhile, Thailand has signed free trade agreements with countries such as Australia and New Zealand, and it has more than 40 ports. It is suitable to serve as a "transit hub" for exporting new energy smart vehicles to other developed countries.
Thailand has a mature automotive industry chain and a high-quality labor force, which has already attracted a large number of Chinese new energy smart vehicle industry chain enterprises to set up factories locally, forming an industrial cluster.
Thailand is suitable to be a primary choice for the overseas expansion destinations of China's new energy smart vehicle industry chain. It is advisable to invest and build factories there to expand the share of products in the overseas market.
Located in Eastern Europe, Poland complies with the EU's carbon emission regulations and relevant policies. Its local GDP maintains steady growth, and the per capita gross national income is around 20,000 US dollars.
Meanwhile, Poland is a country with advantages in the traditional automotive manufacturing industry. Brands such as Volkswagen and Fiat have established factories there. However, the local automotive market in Poland is not large, with an annual sales volume of approximately 550,000 vehicles. The vehicle ownership per 1,000 people exceeds 500, which is at a high level. Local consumers have a relatively high recognition of German and Japanese cars, so it is somewhat difficult for Chinese brands to enter the local market.
Poland is quite suitable as a transit station for Chinese industrial chain enterprises going global. That is to say, Chinese enterprises can conduct research and development, production and manufacturing in Poland, and then export their products to other European regions, so as to avoid the high tariff policies of the EU.
Brazil is the country with the strongest economic strength in South America, with GDP of 2.1 trillion US dollars and a per capita gross national income of over 9,000 US dollars. Meanwhile, Brazil holds a strong geographical position and considerable influence in South America.
Brazil has a solid foundation in the automotive manufacturing industry, with an annual automobile production of over 2 million vehicles. It is also rich in nickel resources, making it suitable for enterprises in the industrial chain to establish factories locally and form supporting industrial chains.
With a population of over 200 million and a young age structure, Brazil will have a large consumer group in the long run. It is worth noting that Brazil has a high penetration rate of flexible-fuel vehicles, indicating a strong local market demand for reducing carbon emissions. However, due to the high penetration rate of flexible fuels, the overall electrification process in Brazil may be relatively slow.
The Chinese new energy smart vehicle industrial chain can regard Brazil as a fulcrum in South America and deeply participate in the South American automotive market in the long term.
The three trends across BRI partner countries are advancing in parallel, requiring enterprises to strategically navigate regional policy differences for agile market adaptation.
China’s new energy smart vehicle industrial chain is accelerating its global expansion, with a surge in overseas production capacity and intensifying competition against Japanese and Korean automakers in strategic markets.
In Southeast Asia, Chinese brands dominate the electric vehicle (EV) sector and, as the market share of internal combustion engine (ICE) vehicles shrinks, Chinese automakers are poised to elevate their global automotive market share. Sustaining this growth requires vertically integrated supply chains spanning battery production, smart driving ecosystems, and localized assembly clusters.
The geographic concentration of overseas expansion destinations among industrial chain enterprises is driven by a combination of factors: policy frameworks, industrial infrastructure, labor cost, resource access, and trade advantages.
In the long term, China's smart automotive industrial chain will deeply empower global markets through its technological advantages and secure greater influence in shaping the international automotive landscape.
EO Intelligence believes leveraging China's globally leading technological edge in the new energy smart vehicle industrial chain, and amid the worldwide shift toward transportation electrification, Chinese enterprises are proactively expanding overseas. They are capitalizing on strategic opportunities in this automotive industry paradigm shift, eroding the market share of traditional automotive giants while spearheading the transformation of the global automotive sector.
Chinese new energy smart vehicle supply chain enterprises should strategically select target countries for capacity deployment based on the geographic footprint of their target customers—whether overseas or Chinese OEMs. For Chinese OEMs, it is critical to drive collaborative offshore expansion with key suppliers, concentrating production in strategic countries, realizing industrial chain integration, cost-efficiency optimization and co-innovation acceleration.
Supply chain enterprises must adopt region-specific strategies to navigate divergent policy incentives and consumer preferences.
For example: If a company is uncertain about the prospects of a specific country or concerned about market volatility, yet seeks to leverage its technological advantages to compete in local commercial markets, it may prioritize an "asset-light model" for overseas expansion. This approach allows flexible adaptation to market dynamics, such as through technology licensing agreements or contract manufacturing, minimizing capital exposure while testing market viability.
Conclusion
The Belt and Road Initiative (BRI) has witnessed rapid development, with China's economic and trade relationships with BRI partner countries remaining stable and marked by year-on-year growth in trade volume and investment. Under the BRI framework, this robust trade foundation serves as a critical prerequisite for the overseas expansion of China's new energy smart vehicle industrial chain.
Due to space constraints, this study preliminarily defines BRI target markets based on automotive production and sales metrics. For these prioritized markets, a targeted PEST analysis (Political, Economic, Social and Technological) was conducted.
In conclusion, Indonesia, Thailand, Poland, and Brazil stand out as primary destinations for the global expansion of China’s new energy smart vehicle industrial chain.
Indonesia benefits from robust economic growth and a demographic dividend driven by its young population, positioning it for an upward trajectory in automotive consumption with rising vehicle ownership per capita. The country has substantial nickel reserves and a well-established automotive manufacturing ecosystem, offering comprehensive cost advantages. As a regional manufacturing hub, Indonesia's strong domestic demand and strategic geographic location make it a primary destination for the overseas expansion of China's new energy smart vehicle industrial chain.
Thailand holds significant advantages in industry, trade, infrastructure, and human resources. In manufacturing, the country demonstrates strong production capabilities, over 1.8 million units, supported by offering competitive cost and export advantages for locally assembled or produced goods. Additionally, the dense concentration of industrial chain enterprises in Thailand has fostered a cluster effect, enabling supply chain companies to efficiently provide supporting services to automakers.
Poland possesses a robust automotive manufacturing ecosystem, with annual production exceeding 500,000 units and a domestic market size approaching 600,000 vehicles. Leveraging its EU membership and strategic location in Eastern Europe, Poland serves as a gateway for Chinese new energy smart vehicle industrial chain enterprises to enter the European market. By establishing localized production in Poland, companies can efficiently access the EU market while avoiding high tariff barriers.
As South America's most economically and industrially robust nation, Brazil has a large automotive market and a comprehensive manufacturing ecosystem capable of producing vehicles at scale. Leveraging its strategic geographic positioning and regional influence, Brazil serves as an ideal strategic place for Chinese industrial chain enterprises to anchor their South American operations, enabling access to the broader regional automotive market.
China’s new energy smart vehicle industrial chain is accelerating its global expansion, with OEMs and supply chain players increasingly establishing production facilities in Belt and Road Initiative partner countries. This has fostered initial cluster effects:
Southeast Asia: Concentrated in Indonesia, Thailand, and Malaysia
Eastern Europe: Anchored in Hungary and Poland
South America: Centered in Brazil
Meanwhile, Chinese enterprises are spearheading the establishment of global standards while strategically sharing core technologies to empower overseas markets. This underscores their growing influence within the industry and lays the groundwork for deeper international market penetration, positioning China’s new energy smart vehicle sector to compete decisively in the global arena.
EO Intelligence maintains an optimistic outlook on the future expansion of China’s new energy smart vehicle industry into BRI countries. We are committed to tracking developments in this sector, delivering rigorous research and actionable insights to guide industry stakeholders. We also welcome collaboration and dialogue with global readers to jointly advance the sustainable growth of China’s new energy smart vehicle industrial chain in international markets.
For detailed insights, refer to our report:《2025 China New Energy Smart Vehicle Industrial Chain Globalization Report: Belt and Road Initiative Chapter》. For inquiries, please contact the report author Chen Haonan at: chenhaonan@iyiou.com.