Thailand EV production draft roadmap within three years; two companies to begin manufacture this year

The government of Thailand is drafting a roadmap for the production of electrified vehicles to begin within three years, the Bangkok Post reports. This roadmap will serve as the national master plan for EV manufacture in the country and it ‘must be finalised this year’, finance minister of Thailand Uttama Savanayana said.

The finance minister has discussed the matter with industry minister Suriya Juangroongruangkit, the news site reported, though noting that other agencies and the energy and transport ministries have yet to be included in the discussions.

This roadmap should build confidence among automakers who aim to begin manufacturing of electrified vehicles in Thailand as they have asked for a clear government policy as well as investment criteria and incentives to encourage EV production in the country, along with a clear plan for infrastructure such as charging stations and EV charging logistics.

Though there are a variety of charging systems available from various makers around the world, any model selected must meet Thailand’s safety standards, said Uttama, adding that the country’s supply of electricity must be taken into consideration. Automakers are also ready to invest in EV charging stations in the country, though they want to know what support will be offered from the Thai government, the report said.

Launched in March 2017 by the Thai Board of Investment (BoI), the EV scheme aimed to encourage investment applications from automakers; the eligible vehicles are hybrid, plug-in hybrid and battery-electric versions. EV manufacturing privileges were granted to 13 companies, including Toyota, Honda, Nissan, Mazda, Mercedes-Benz, BMW, SAIC Motor-CP, FOMM, Mitsubishi and Mine Mobility.

A separate Bangkok Post report said that two automakers will commence the manufacture of electric vehicles in Thailand this year to take advantage of tax breaks, said the country’s excise department director-general Patchara Anuntasilpa. The director-general declined to specifically name the two automakers, only saying that the pre-requisite for automakers to begin producing EVs in the country from this year is to already have an assembly line from 2018.

To this end, the Thai government is offering an excise tax exemption for automakers producing EVs in the country from 2020 to 2022, compared with an excise tax rate of 2% in normal cases, the news site reported. Taxation measures alone are not the sole determinants of EV production commencement in Thailand, Patchara said, nothing that factors such as EV battery plants and charging stations also play a vital role.

Policymakers in the country are encouraging the construction of local battery production plants in order to reduce costs, given that EV batteries represent 70% to 80% of a vehicle’s price, Patchara said. Due to the advanced technology required for the manufacture of EV batteries, however, the construction of local battery production plants are uncertain, he added.

The country’s excise department will also push for the establishment of an EV battery management fund to prevent or mitigate the accumulation of electronic waste when the components come to the end of their lives, in light of an increase in imported EVs from China and other ASEAN countries into Thailand.

A law will be enacted by the excise department to ensure the proper disposal of EV batteries in line with international standards, Patchara said. Under this law, imported EVs which do not have BoI incentives will be subject to a disposal fee of 10,000 baht (RM1,340) per battery to the fund, while those with BoI incentives could be charged just 1,000 baht (RM134) per battery. These fees will be refunded upon evidence that the batteries have been properly disposed of, Patchara noted.

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