Tesla's plans to scrap production in SEA a commercial decision, says MITI

Tesla Inc's reported decision to scrap plans for its production operations in Southeast Asia could be a commercial decision, the Investment, Trade and Industry Ministry (MITI) reportedly said. 

A spokesperson from MITI reportedly said that Tesla's decision does not reflect the industrial reforms and improved investment landscape that the ministry and its agencies have been working on since December 2022, reported Bernama. 

Yesterday, a Thai online news portal called The Nation, quoted a source in the government saying that Tesla has scrapped its plans to set up an electric vehicle manufacturing plant in Thailand.  

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The Nation reported that Tesla is not only suspending its factory plans in Thailand, but worldwide too including countries such as Malaysia and Indonesia. The news portal added that the decision follows the layoffs of a team of Tesla executives that visited Thailand between November to December.

The Thai news portal also reported that Tesla is currently only discussing charging stations. 

According to Bernama, the MITI spokesperson emphasised that the news report is not an official statement from Tesla as it was based on comments from an unnamed source. The spokesperson reportedly added that confirmation of the report would have to come from Tesla. 

In November last year, it was reported that Malaysia has allowed Tesla and Starlink Internet Services Malaysia to operate in the country as fully foreign-owned entities. The decision was made after considering the benefits that the companies could bring to the nation. 

An exemption of the Communications and Multimedia Act 1998 (Act 588) was reportedly given to Starlink by the Communications and Digital Ministry through the Malaysian Communications and Multimedia Commission (MCMC). Under this exception, Starlink was permitted to provide satellite internet services to Malaysian users.  

The decision to allow Tesla full foreign ownership was also part of the Malaysian government’s aim expand and diversify the manufacturing sector through existing and new companies, according to The Star.   

Meanwhile, in May of this year, Elon Musk and Indonesian health minister Budi Gunadi Sadikin launched SpaceX's satellite internet service, Starlink, for the nation's health sector. 

Musk, the CEO of SpaceX, said that Starlink's service in Indonesia would help millions in remote areas to access the internet. 

"We're focusing this event on Starlink and the benefits that high bandwidth connectivity can bring to remote islands and to remote communities," said Musk in a video he posted on X.

"I think it's really important to emphasise the importance of internet connectivity and how much of a life saver that can be." 

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