EV Firms In Thailand Seek Easing Of Manufacturing Conditions

In Thailand, the National Electric Vehicle Policy Committee will be asked to consider easing EV manufacturing requirements by allowing manufacturers, notably Chinese EV makers, to reduce their production output due to sluggish car sales, says the Federation of Thai Industries (FTI).

Source: Bangkok Post

Automakers in Thailand who were granted incentives under the EV3.0 scheme are required to assemble EVs locally from 2024 and meet production targets set by the government. EV3.0 refers to a package of incentives including lower excise tax and import duties as well as subsidies to promote EV consumption and production between 2022 and 2023.

Chinese firms are preparing to push ahead with their request to relax the requirements, pending the National Electric Vehicle Policy Committee, chaired by Prime Minister Paetongtarn Shinawatra, to call a meeting.

“At least eight Chinese EV makers are waiting to have talks with the government. They are worried about the oversupply of EVs in the market,” said Surapong Paisitpatanapong, vice-chairman of the FTI and spokesman for the federation’s Automotive Industry Club.

These companies are BYD, Changan, Great Wall Motor, MG, GAC Aion, Omoda & Jaecoo, Neta and Zeekr. They are worried about the impact of sluggish domestic car sales on their EV production plans, said Mr Surapong.

The lower rate of sales is being attributed to fewer auto loans being granted by banks and slow economic growth. Companies participating in EV3.0 and beginning to produce EVs within 2024 are committed to a 1:1 ratio target, meaning they must produce one EV domestically for every EV they import.

The numbers are set to increase under the 1.5:1 ratio (1.5 locally produced EV for each imported EV) if they begin production next year. Up to 23 global car companies joined EV3.0 and they have already imported more than 100,000 EVs. Mr Surapong remains positive about EV sales despite a months-long slowdown in domestic car sales.

“Compared with the decline of internal combustion engine-powered car sales, EV sales have still been on the rise,” he said. From January to August, battery EV sales in the passenger car category rose 13.8% year-on-year while hybrid EV sales increased by 62% year-on-year, according to the club.

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