Thailand trims down EV subsidy package amid booming sales

Thailand is planning to introduce a new purchase subsidy scheme for domestically made electric vehicles (EVs) from 2024 to 2027.

Key Takeaways

• Thailand is planning to offer a purchase subsidy scheme for domestically made electric vehicles to attract foreign investment and position itself as a Southeast Asian EV manufacturing hub.
• The new subsidy scheme, called EV3.5, will provide a subsidy of up to 100,000 baht per car from 2024 to 2027, aiming to support the growing demand for EVs in the country.
• China is leading the way in Thailand’s EV market, with major Chinese brands already established and new investments from European makers also being encouraged.

The scheme, known as “EV3.5,” will offer subsidies of up to 100,000 baht ($2,760) per car, aiming to attract foreign investment and position Thailand as a regional EV manufacturing hub.

The current subsidy scheme, which ranges from 70,000 to 150,000 baht per EV, will expire at the end of this year. The Thai government aims to have EVs account for 30% of vehicles sold by 2030 and has already seen investments from Chinese and European EV makers.

RelatedArticles

Thailand’s Automotive Industry Showed Decline in September 2024

October 25, 2024

Nvidia plans Major Investments in Thailand Ahead of CEO Jensen Huang’s Visit

October 24, 2024

Addressing the Charging Infrastructure Challenge in Asia’s EV Market

October 17, 2024

Thailand Imposes Stricter Regulations on Business Nominees

October 4, 2024

In the second quarter, electric vehicles (EVs) made up 6.4% of all passenger car sales in the region, a significant increase from the 3.8% recorded in the first quarter, according to data from Counterpoint Research.

Electric vehicle sales in the region are dominated by Thailand, Vietnam, and Indonesia. Chinese carmakers such as BYD are leading the market by a significant margin.

The government has also agreed to reduce the import duty on completely built-up (CBU) EVs by up to 40% for 2024 and 2025. This reduction will apply to vehicles priced at up to two million baht per unit.

Additionally, the government plans to decrease the excise tax from 8% to 2% on cars priced at up to seven million baht. However, this reduction is contingent upon importers producing two locally manufactured EVs for every imported EV by 2026, and three locally manufactured EVs for every imported EV by 2027.