In a decisive move for the automotive sector, Thailand's Excise Department has announced that car manufacturers benefitting from the government's electric vehicle (EV) incentives must begin producing key EV components domestically by 2026. This directive comes from Excise Department Director-General Ekniti Nitithanprapas.

 

Ekniti emphasised that vital parts like the electric motor, reducer, and inverter need to be locally assembled. The electric motor converts electrical energy to motion, the reducer functions like a gearbox, and the inverter switches direct current (DC) from the battery to alternating current (AC).

 

The government's phased EV promotion measures are encouraging auto manufacturers to set up production bases in Thailand. Investments from these manufacturers have already exceeded 80 billion baht, a significant boost for the local economy.

 

However, companies must meet strict local production targets. They must match imports at 100% of their sales in the first year. If they fall short, they need to produce 1.5 times their sales volume in the second year. This strategy aims to draw in investment and create jobs, fostering economic growth and environmental sustainability.

Despite these positive steps, the department has faced challenges. Ekniti reported a 30% drop in vehicle tax revenue during the first 11 months of fiscal 2024. This decline is due to reduced production and sales, along with tax cuts for EVs. Vehicle tax remains a crucial revenue source for the department.

 

In related news, the Board of Investment has approved measures to encourage EV battery manufacturing. Investors in module-level manufacturing receive an eight-year corporate income tax holiday, and those at the pack level get a five-year exemption.

 

Cell-level investments enjoy both an eight-year tax exemption and subsidy from the EV promotion fund.

 

These initiatives are poised to rev up Thailand's EV sector and bolster local manufacturing, ensuring the country stays on track towards a sustainable future.

 

Picture courtesy: Auto World Journal

 

 

-- 2024-09-24

 

3 hours ago, webfact said:

In a decisive move for the automotive sector, Thailand's Excise Department has announced that car manufacturers benefitting from the government's electric vehicle (EV) incentives must begin producing key EV components domestically by 2026. This directive comes from Excise Department Director-General Ekniti Nitithanprapas.

Considering Thailands automotive industry is largely sub-contract from overseas manufactures/owners is that even possible?