Thailand to reduce EV subsidy in 2024 as sales boom

Peng Chen, DIGITIMES Asia, Taipei 0

Credit: AFP

Thailand will lower the government subsidy for EV purchases starting next year due to the growing sales. The Thai government also plans to provide incentives for carmakers to establish EV R&D centers in the country.

According to Thailand Business News and Reuters, Thailand currently subsidizes THB70,000 (US$1,956) to THB150,000 per EV. The subsidy scheme will expire at the end of this year.

The Thai government plans to start a new subsidy program in 2024 that will continue until 2027. The new scheme will offer up to THB100,000 per EV.

Reuters reported that Narit Therdsteerasukdi, secretary general of the Thailand Board of Investment, said the EV adoption rate in the country has increased significantly in recent years with the government's support. Therefore, the government plans to cut the subsidy gradually to relieve some burden on its budget.

Thailand also aims to reduce the import duty on completely built-up EVs priced at up to THB2 million. The reduction in duty can reach 40% at most. In addition, the country will offer automakers tax breaks and other incentives to establish local EV R&D centers.

The above measures aim to solidify Thailand's role as the EV manufacturing hub in Southeast Asia. The Thai government plans to electrify 30% of the cars the country produces per year by 2030. Thailand manufactures about 2.5 million vehicles annually.

According to Counterpoint Research, Southeast Asia saw its passenger EV sales surge by 894% in the second quarter of 2023, thanks to the strong demand generated in Thailand, Vietnam, Indonesia, and Malaysia.

The research firm said government promotion and more EVs available in the region benefited the sales. Many car companies have launched low-priced models that target a broad range of consumers.