In February 2022, Thailand announced new government incentives for its electric vehicle (EV) industry as part of its ambitious plan to convert 50 percent of its total auto production to EV by 2030 and become a production base for cleaner vehicles in Southeast Asia.
The new incentive package includes significant exemptions from import duties and excise taxes for a wide range of EV models, not to mention the previous subsidies announced in February.
The EV incentive package reflects ASEAN’s continued investment in eco-friendly transportation to align major car manufacturers with the global transformation of electric vehicles. According to a 2021 EV report, the total stock of ASEAN electric powered vehicles reached 3.4 million in 2019 and is projected to grow amid concerns for economic development, growing population and environment.
The latest incentive packages announced include:
The incentive will initially apply to 27 model types of EVs which include:
The package is a follow-up to pre-February subsidy programs to encourage EV production and purchases, including:
Subsidy programs are funded by 3 billion baht (US $ 90.4 million) from the 2022 central budget and long-term 40-billion-baht (US $ 1.2 billion) investment in the EV industry between 2023 – 2025.
The country is keen to play a key role in becoming a hub for EV production, but manufacturers face challenges. These range from inadequate infrastructure to financial constraints.
Inadequate EV infrastructure development is an obstacle to the development of an overall EV manufacturing industry in Thailand. According to the Bangkok Post, the country could take up to a decade to effectively produce EVs because existing supply chains are designed to manufacture vehicle parts and bodies, including internal combustion engines (ICEs).
There is also a shortage of charging stations across Thailand, with only 1,000 or more public charging points compared to about 30,000 gas stations – there is also a shortage of home charging stations. Furthermore, many Thai consumers are concerned about the barriers to EV performance, including reliability, battery life, range, engine power, and charging time.
This article was first published by AseanBriefing which is produced by Dejan Veins & Associates. The company supports foreign investors across Asia from the office Around the worldIncluding China, Hong Kong, Vietnam, Singapore, IndiaAnd Russia. Readers can write [email protected]