Volkswagen may set up plant in Thailand – report

volkswagen

Volkswagen AG has applied to set up its first assembly plant in Thailand, reports Bloomberg, citing people familiar with the matter.

The German carmaker is seeking to participate in a government programme that offers tax exemptions for carmakers investing at least 6.5 billion baht (RM656 million) in local manufacturing, said the sources, who did not want to be named because a final decision has yet to be made.

Also, annual production must reach at least 100,000 cars by the fourth year of operation, and manufacturing must start by 2019.

This is consistent with our northern neighbours’ Eco Car programme, which includes vehicle assembly, components and engine production. Carmakers had until March 31 to apply, the report states, citing a ministry statement from last October.

The Eco Car programme’s second-phase requirements include (for the vehicle) a fuel economy under 4.3 litres per 100 km, CO2 emissions under 100 grams per km, engines displacing 1.3 litres and under (petrol) or 1.5 litres and under (diesel), plus Euro 5, R94 and R95 compliance.

Throw in a minimum investment of 6.5 billion baht (RM656 million) and a minimum production of 100,000 units per year by the fourth year of operation, and the excise duty incentive given is 14% (normally 30%); dropping to 12% if the engine is E85-compatible.

First-phase Eco Cars include Hondas Brio and Brio Amaze, Mitsubishis Mirage and Attrage, Nissans Almera and March, the Toyota Yaris and the Suzuki Swift – all of which are powered by 1.2 litre petrol engines in Thailand.

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Jonathan James Tan

While most dream of the future, Jonathan Tan dreams of the past, although he's never been there. Fantasises much too often about cruising down Treacher Road (Jalan Sultan Ismail) in a Triumph Stag that actually works, and hopes this stint here will snap him back to present reality.

 

Comments

  • Malaysia missed FDI again

    Well-loved. Like or Dislike: Thumb up 95 Thumb down 1
    • Im22butilikethenewcamry on Apr 02, 2014 at 11:45 am

      True that bro. Sigh. Sometimes we wonder, when will it change..

      Like or Dislike: Thumb up 38 Thumb down 0
      • BarisanInternasional on Apr 02, 2014 at 10:42 pm

        It will never change under the current people who control the Government. We need something drastic like a change of the ruling party.

        Like or Dislike: Thumb up 8 Thumb down 1
    • Nappy on Apr 02, 2014 at 12:05 pm

      Thanks to Dr M the father of Thailand automotive industry…

      Well-loved. Like or Dislike: Thumb up 102 Thumb down 3
    • kzm (Member) on Apr 02, 2014 at 3:16 pm

      U all don’t want VW production plant in bolehland..Why the fuss? don’t tell me that u guy actually want VW local production..

      Like or Dislike: Thumb up 3 Thumb down 28
      • Unforgiven on Apr 08, 2014 at 9:54 am

        We should be the expert or high level people that managed the automated/advanced plant. We have the knowledge.

        Like or Dislike: Thumb up 1 Thumb down 0
  • Obviously (Member) on Apr 02, 2014 at 11:00 am

    “6.5 million baht (RM)”? Did something get left out there, Jonathan? I don’t think Thai baht has become 1:1 with RM yet eh?

    Like or Dislike: Thumb up 2 Thumb down 1
  • Do something about it m'sia gov on Apr 02, 2014 at 11:21 am

    Malaysia gov should do something about this…. hit them with something sweeter than what the Thai gov can give. then our economy can improve… gaining from less tax is better than no tax (earnings gone to Thai). Instead of waiting car makers to approach gov, we should approach car makers and offer what we can.. same goes to other industry.

    Like or Dislike: Thumb up 34 Thumb down 1
    • Amanda on Apr 04, 2014 at 8:29 am

      I think the time for us offer tax exemption to foreign companies are long gone. We need the $$$$ from them.
      If we offer them with free tax exemption – what benefit do we get in the immediate future? Socio economic benefits – employment for the locals or for the Indons that we have to bring in to work at our factories???

      Like or Dislike: Thumb up 0 Thumb down 0
  • Imagine with the unrest and they still choose Thailand. It clearly shows our government’s automotive policy is as good as using it for wiping your arse!

    Well-loved. Like or Dislike: Thumb up 64 Thumb down 3
  • Nabill on Apr 02, 2014 at 11:32 am

    Their gain is our loss…we deserve it wen we hv monkeys runing da show

    Like or Dislike: Thumb up 47 Thumb down 2
  • slk3879 on Apr 02, 2014 at 11:35 am

    what have Malaysian authorities achieve?

    Like or Dislike: Thumb up 26 Thumb down 1
    • Twin Tower and Proton is our proud achievement!

      Like or Dislike: Thumb up 11 Thumb down 18
    • spotlight handling the MH370 lah what else.

      Like or Dislike: Thumb up 7 Thumb down 4
    • tikus on Apr 02, 2014 at 6:37 pm

      Showing the world we have BOMOH KING that can see things that satellite dont.Need to ask Bomoh what is the future of Malaysia Auto industrial like?

      Like or Dislike: Thumb up 6 Thumb down 1
    • Hemi 426 on Apr 02, 2014 at 9:02 pm

      Nothing Sir.Full stop.

      Cheers

      Like or Dislike: Thumb up 14 Thumb down 0
  • Settle settle settle on Apr 02, 2014 at 11:37 am

    People got clear standard on everything especially tax exemption.

    Our NAP has nothing but list of CO2 emission, yet the carmaker need to settle the tax exemption in a private meeting with government officials.

    No wonder no one interested to come.

    Settle in private meeting? You think meeting up your mistress?

    Like or Dislike: Thumb up 46 Thumb down 0
  • satekj38 on Apr 02, 2014 at 11:45 am

    Thanks to the NAP, we are losing out the FDI again to Thailand & Indonesia…

    Like or Dislike: Thumb up 39 Thumb down 1
  • Malaysia is full of corruption. Bye bye Malaysia.

    Like or Dislike: Thumb up 43 Thumb down 4
    • kzm (Member) on Apr 02, 2014 at 3:24 pm

      What the diff with thai govt? Look same to me…their current PM is caught in subsidy scandal,…the previous PM accuse of power abuse…former PM taksin oso corrupt…indo? even worst corrupt country than bolehland…the oni look not corrupt country in ASEAN is for sure Singapore

      Like or Dislike: Thumb up 8 Thumb down 22
      • 4G63T DSM on Apr 02, 2014 at 5:02 pm

        Yes, you are correct.

        Thai so bad also automotive players all flock there.

        Makes Malaysia look even worst

        You are doing real good shooting yourself in the foot.

        Like or Dislike: Thumb up 20 Thumb down 1
        • kzm (Member) on Apr 02, 2014 at 9:02 pm

          That obviously mean thai n indo bribe much more than boleh bribe so that car maker open plant in their country..I don see I’m shooting myself..it look like u shooting urself with that statement..

          Like or Dislike: Thumb up 2 Thumb down 12
          • Swaik on Apr 03, 2014 at 5:52 am

            I don’t understand why you compare ourselves with among the worst and not with among the best or just say better la….this is backward mentality la bro.

            Like or Dislike: Thumb up 5 Thumb down 0
      • Why are most of your response so typically comparing with countries in areas that are either same or worse off then us? Compare with things that they are better. No one said their government is perfect, but hell they certainly do have a far better automotive policy then us. Compare la that. Not “what so good about thai government. they are just as corrupted..blah..blah” How to progress?

        Like or Dislike: Thumb up 14 Thumb down 0
        • kzm (Member) on Apr 02, 2014 at 8:58 pm

          From top till down wat comment did u see?

          Like or Dislike: Thumb up 0 Thumb down 7
          • Malaysia is full of corruption. Bye bye Malaysia.
            Like or Dislike: Thumb up 36 Thumb down 3
            kzm (Member) on Apr 02, 2014 at 3:24 pm
            What the diff with thai govt? Look same to me…their current PM is caught in subsidy scandal,…the previous PM accuse of power abuse…former PM taksin oso corrupt…indo? even worst corrupt country than bolehland…blah..blah…comparing…no one cares about other countries that are worse…etc…lazy to explain over and over again….

            Like or Dislike: Thumb up 2 Thumb down 0
      • bomohking on Apr 03, 2014 at 8:43 am

        that’s why they go crazy and now reelect another leader. Better than sitting still doing nothing like us in Malaysia. Other manufacturers also see more hope in them than us. They corrupt, people at least do something. We corrupt, we computer rage. Thaksin corrupt, they despise him. Ours? Don’t need to say la. Don’t be blind please. Their blood spilled may not be a good thing. Chaos and violence but their love for their country and their voice can threaten the leaders also. It isn’t the best resort to settle a dispute but at least something is happening. I’m not saying it’s the best way but at least there is a drastic movement. Malaysia? Don’t need to say la.

        Like or Dislike: Thumb up 3 Thumb down 1
  • Whatever on Apr 02, 2014 at 11:48 am

    While in Malaysia nothing is conclusive yet… FDI is forsaken for the accumulation of wealth of the selected few / cronies.

    Like or Dislike: Thumb up 26 Thumb down 0
  • Sunriver on Apr 02, 2014 at 11:49 am

    There goes another one up north.
    It goes to show, even with the Red and Yellow Shirts fighting, auto companies do see the potential in setting up shop there. What gives?

    Our policy makers should be concentrating in getting al these investments rather than focusing on someone’s gay-ness, comparing the size of my cable to your cable, their own money making projects and etc….

    Like or Dislike: Thumb up 28 Thumb down 0
  • Unforgiven on Apr 02, 2014 at 11:55 am

    Based on yesterday newspaper, Malaysia education level is lower than Vietnam now. VW is at least top 3 in the World. The next generation will definitely feel the pain, especially those under protected now. It’s globalization world now.

    Like or Dislike: Thumb up 40 Thumb down 3
    • I know lecturers who tell me that they cannot fail certain people, thus we have will soon be the first country in the world to have the highest educated population with the lowest standard. Malaysia Boleh….Malaysia Boleh!

      Like or Dislike: Thumb up 18 Thumb down 1
  • Cheh, just an assembly plant.

    We already have it loooooong time ago at Pekan.

    Like or Dislike: Thumb up 11 Thumb down 27
  • Thailand again. why not Indonesia? of course definitely not Malaysia. Wake up! Malaysia gov.

    Like or Dislike: Thumb up 25 Thumb down 1
  • Anti-Fuel-Price on Apr 02, 2014 at 12:22 pm

    Congrats VW, “R.I.P Automotive Malaysia”. We loose Job opportunity, Investment :(

    Like or Dislike: Thumb up 14 Thumb down 0
  • Wilson on Apr 02, 2014 at 12:28 pm

    Malaysia prefer to have more recond car in the market since earning more taxes.

    Like or Dislike: Thumb up 5 Thumb down 0
  • cendol (Member) on Apr 02, 2014 at 12:54 pm

    Malaysia will say we don’t need all these companies setting up company here.
    Our domestic market is very strong and resilient.
    And we hope those who do not agree with me to go back to your countries of origin.

    Like or Dislike: Thumb up 14 Thumb down 0
  • sinkingship on Apr 02, 2014 at 1:28 pm

    can’t take this anymore…arrgh
    malaysia is just so bloody lembap

    Like or Dislike: Thumb up 9 Thumb down 1
  • adullah on Apr 02, 2014 at 2:25 pm

    Our government offer of customized incentive is just
    an avenue for more corruption.
    It means the playing field is not level.
    Imagine a football game with different rules for every team.

    Like or Dislike: Thumb up 11 Thumb down 0
  • good move for our NAP…one more FDI drain to kingdom of smile…

    Like or Dislike: Thumb up 3 Thumb down 0
  • We will never change & never learn. Sustaining Proton as national car maker is the No.1 priority even at the expense of losing billions of FDI to our lucky neighbours who are laughing all the way to the bank. We are such good & generous neighbours. Well done Mal & keep up the good job!

    Like or Dislike: Thumb up 8 Thumb down 0
  • Nabill on Apr 02, 2014 at 6:01 pm

    I honestly dont think thy chose thai bcos its beter…i think when thy submited their application to msia some guys here wnted so much kickbacks that it was nt feasible for thm to b operating here wer ppl at da top CONSTANTLY ASK FOR FAVOURS… in thai thy r free to do anything its a proper open market…here thy wil eventually b some political interferance in watever biz bcos someone want to ‘join’…

    Like or Dislike: Thumb up 4 Thumb down 0
  • VVVWWW on Apr 02, 2014 at 7:11 pm

    VW looking for own manufacturing plant is no secret in the industry. There were rumors that Proton plans to move to Tg Malim so VW can buy over the Shah Alam facilities. Now VW decided to move to Thailand meaning they have finally given up the plan to set up manufacturing plant in Malaysia. Viva Proton

    Like or Dislike: Thumb up 4 Thumb down 0
    • Heng Lee on Apr 03, 2014 at 2:57 am

      Thank God they were not able to purchase our Proton facilities!

      Like or Dislike: Thumb up 0 Thumb down 2
  • Magnus on Apr 03, 2014 at 11:08 am

    One shall stand, one shall fall….

    Like or Dislike: Thumb up 0 Thumb down 0
  • When I read this piece of news, it makes me bit sad.
    Let me say, I was hoping that VW would expand it’s capacity in Malaysia.
    You see, I’m one of the many vendors that’s supplying to HICOM for the manufacturing of VW Cars. And the VW facility there is one of the most modern in the whole of Malaysia.( I’ve seen plenty )When the German guys came in , they brought with them lots of knowledge and equipments. And our ordinary folks at Pekan, benefited tremendously from it. From the lowly operators to engineers. Even d tukang makcik found work !
    I think our workforce is actually ready for such huge investments. Land are plenty there to build huge factories and folks from around Peramu, Kuantan even Rompin can find work. And they are some if the nicest folks you can find anywhere.
    But all this was let down by d recent NAP, I guess it was not transparent and clear in execution. It didn’t make it clear why foreign companies should invest in Malaysia.
    I’m biased in this case, as it helped me put food on d table and created employment for my staff.
    I do hope they address this VW issue quickly. If not, our loss becomes someone else gain. BTW- if u own a VW , good chance are it was made using some products supplied by us.
    Good night.

    Like or Dislike: Thumb up 0 Thumb down 0
  • helloVWVW on Apr 20, 2014 at 2:51 pm

    Thai : ” Thanks to Proton, Thanks to Malaysia Gov”

    Like or Dislike: Thumb up 0 Thumb down 0
 

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