EV battery production plant of MG Thailand. (Photo: MG Automotives)
Thailand's National Electric Vehicle Policy Committee (EV Board) approved two new stimulus measures on Feb. 21 to boost local production of vehicle batteries and energy storage systems, as well as promote the development of electric buses and trucks. The subsidies could potentially save companies up to half of the costs of constructing factories. Thailand continues to roll out incentives, aiming to solidify its position as a hub for electric vehicle production.
Narit Therdsteerasukdi, Secretary-General of the Thailand Board of Investment (BOI) and Secretary of the Electric Vehicle Committee, stated that unlike the previous phases (EV3 and EV3.5), which primarily focused on passenger vehicles, the new stimulus plan targets commercial vehicles.
Thailand is the largest automobile producer in Southeast Asia, often referred to as the "Detroit of the East." Amidst the wave of electric vehicle development, it is not only the first country in Southeast Asia to offer practical incentives for both supply and demand sides but has also set a clear goal of achieving a 30% share of electric vehicle production by 2030.
The Thai government will provide subsidies to companies willing to establish battery factories in the country, with the actual amount determined based on individual case discussions. Narit revealed that this could potentially save companies 30-50% of their factory construction costs.
To be eligible for investment projects, companies must meet the following basic criteria: (1) be a leading manufacturer of vehicle batteries, (2) have a clear blueprint for the development of vehicle batteries, with a focus on energy storage system batteries, (3) batteries must have a high energy density of at least 150 Watt-hour per kilometer, and (4) batteries must be capable of at least 1,000 cycles of use.
Interested companies must submit their investment proposals by the end of 2027.
In addition, for enterprises using electric buses or trucks, the Thai government will deduct procurement costs from corporate income tax calculations, with no price threshold. Purchasing locally manufactured or assembled vehicles allows for a deduction of twice the vehicle price, while imported vehicles allow for a deduction of 1.5 times the vehicle price. This incentive is valid until 2025.
