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Thailand has had separate eco car and EV schemes in recent times. The programmes were for certain types of vehicles – affordable small cars for the former, of which two phases have already been introduced; and hybrid, plug-in hybrid or electric for the latter – and carmakers were enticed with tax breaks and exemptions for their efforts.

Now, the Thai government has concocted another scheme, and the Eco EV programme combines a bit of both the earlier schemes, as its name suggests. Affordable electrified eco cars is the name of this game, and the kingdom’s Office of Industrial Economics (OIE) has met with Toyota, Honda and Nissan to discuss the scheme and offer incentives.

“Eco EV is aimed at closing any loopholes after the government launched the EV scheme in late March 2017, as the scheme should not be an obstacle to the current eco-car scheme. The OIE has found that the existing EV scheme was ineffective at boosting mass-market production of EVs and localising the manufacture of EV-related vital components,” said OIE director-general Nattapol Rangsitpol, reported by the Bangkok Post.

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Nattapol elaborated by describing the current EV scheme is a “free and open ticket” for carmakers to produce any green car in any vehicle segment. “Locally there are only high-end hybrid EVs priced above one million baht, same as before the scheme,” he said.

The OIE’s proposal was for mild hybrid cars to be turned into affordable Eco EVs. “The mild hybrid under the Eco EV programme can offer prices ranging from 500,000 to 700,000 baht, equivalent to eco cars that are available in the local market,” Nattapol said. The country’s excise department said that Eco EVs may be taxed at 4%, on a par with hybrids and much lower than the 10-14% of today’s eco cars.

However, the top three Japanese carmakers that have Thailand as their regional base – Toyota, Honda and Nissan – said no thank you. The OIE man said the companies wanted to wait for the market mechanism to catch up and for EV excise tax incentives to expire in 2025.

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However “by 2025, Eco EV will not be appropriate for the technological landscape and Thailand’s automotive industry will be far behind other countries,” he lamented.

The three carmakers asked for a one-year extension to the offer. Nattapol said the OIE will continue working on the programme with other eco car companies. Besides Toyota, Honda and Nissan, the other eco car participants were Mitsubishi, Suzuki and Mazda.

Those who have received Thailand’s Board of Investment EV incentives so far include Mazda and Toyota in the regular hybrid category, plus Mercedes-Benz, BMW and SAIC Motor (MG) in the PHEV category. Learn more about Thailand’s green car local assembly incentives here.

Making basic small cars may be profitable if you know how, but perhaps throwing in hybrid tech/batteries will also throw away the business case for the Japanese giants. But with a bigger carrot, who knows?

 

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