Picture courtesy of Bloomberg

 

Former PM urges local content rules to boost industry growth

 

Could the electric vehicle (EV) surge threaten Thailand’s automotive sector? Former Prime Minister Thaksin Shinawatra believes so, advocating for significant tax reforms to defend local carmakers against foreign competition.

 

Thaksin proposes a hefty excise tax on imported EVs with minimal local content to safeguard Thai manufacturers. His concerns arise from free trade agreements, especially the ASEAN-China FTA, which has led to an influx of tariff-free EVs undermining domestic players.

 

He suggests mandating a minimum local content level in imported EVs, like car seats, to ensure the Thai automotive sector’s growth. The FTA with China removed import tariffs, enabling cheaper foreign EVs to invade the market.

 

The Excise Department is now considering revising the tax structure. The new proposal would lower taxes on vehicles with a high percentage of local components, promoting the use of Thai-made parts and protecting the industry.

 

Deputy Finance Minister Paopoom Rojanasakul stated, “The goal is to support the domestic auto parts industry by encouraging the use of locally made components.”

 

Some analysts feel these measures might also address potential tariff threats from the United States, which could affect Thailand’s exports.

 

Economist Sompop Manarungsan noted that the reduced tariffs on American vehicles are unlikely to impact Thailand’s market. US manufacturers struggle to compete with Southeast Asian carmakers on parts costs and model updates. Additionally, despite low tariffs, American vehicles barely penetrate markets like Japan.

 

As Thailand shifts towards becoming an EV production hub, the rise of electric vehicles offers both opportunities and challenges. From 2022 to 2024, EV registrations for BEVs, PHEVs, and HEVs surged, with significant investments in production and infrastructure.

 

However, intense foreign competition has led some Chinese EV firms to withdraw, returning subsidies and facing penalties for not meeting local production criteria, according to the Bangkok Post.

 

Thailand’s bold EV strategy is vital for its future as a regional export hub, with ongoing developments in manufacturing, charging networks, and battery production.

 

By 2030, Thailand aims to lead Southeast Asia in EV production, leveraging locally produced components to enhance the industry and promote environmental benefits.

 

  Adapted by ASEAN Now from The Thaiger 2025-08-04

 

This is exactly the kind of behaviour that encourages reciprocal tariffs - but this time they're playing with both the US and China.

So Thailand negotiates a FTA then decide they don't like it and decide they want to increase tariffs. It's deja-vu all over again.

5 hours ago, webfact said:

Thaksin proposes a hefty excise tax on imported EVs with minimal local content to safeguard Thai manufacturers.

And in what position or authority is he using to make this proposition that apparently was given to someone important in the government? 

 

When will Thaksins reign end?

47 minutes ago, thesetat said:

And in what position or authority is he using to make this proposition that apparently was given to someone important in the government? 

 

When will Thaksins reign end?

He just so happens to be the man who rescued Thailand from Military incompetent rule and the baht crash. The only person who can hold his head up with GDP figures of over 14%, and the highest English proficiency results in Thailands history.  So all in all a very qualified guy! Now you will start spouting "Ah but he is a criminal, ah but , he was corrupt! First being ousted by a military coup, tarnished any conviction that followed then you will say currupt! Corruption rose sharply when the boys in green rolled their tanks into Bangkok!!! Figures of a 20% rise were mentioned by some. So, from 20% to 40% skim before anything done....

Given the low wage structure in Thailand (mind-bogglingly low!), it's surprising that ANY tariff structure is required to protect Thai industry, whether domestically or for exports.

 

cf Burkina Faso who have apparently begun designing & manufacturing their own EVs! But I guess Thailand simply isn't up to the standard of the poor little Burkinabés.

1 hour ago, edwinchester said:

So Thailand negotiates a FTA then decide they don't like it and decide they want to increase tariffs. It's deja-vu all over again.

Thailand signed an FTA with China primarily through the Asean-China FTA framework around 20 years ago, setting zero tariffs on imports, including EVs.

At the time of the agreement, EVs were not yet widespread, and Thai officials understood "electric vehicles" as golf carts, believing they would have little impact on the domestic auto industry.

https://www.bangkokpost.com/business/motoring/3076800/tax-rejig-favours-evs-with-more-local-parts

 

2 minutes ago, vinny41 said:

At the time of the agreement, EVs were not yet widespread, and Thai officials understood "electric vehicles" as golf carts, believing they would have little impact on the domestic auto industry.

Ha ha. How times change. But Thailand doesn't (much) ...

So US tariffs bad , Thaksin's tariffs good ?

1 hour ago, mfd101 said:

Given the low wage structure in Thailand (mind-bogglingly low!), it's surprising that ANY tariff structure is required to protect Thai industry, whether domestically or for exports.

 

cf Burkina Faso who have apparently begun designing & manufacturing their own EVs! But I guess Thailand simply isn't up to the standard of the poor little Burkinabés.

Nice point. 

3 hours ago, edwinchester said:

So Thailand negotiates a FTA then decide they don't like it and decide they want to increase tariffs. It's deja-vu all over again.

 

Thailand had an FTA with Australia.

 

Ford Thailand imported Ford Territory vehicles.... with interior excises/taxes they hit the ford showrooms at 3 million baht.... nearly triple the aus price !

1 hour ago, mfd101 said:

Ha ha. How times change. But Thailand doesn't (much) ...

 

EVs are the future and sales are increasing (other fuels <e.g. hydrogen> will no doubt come into the picture) and gasoline engine cars will ne douby continue to decrease.

 

Seems to me the Thai authorities need to create policies which help Thailand get out of the gasline engine market / manufacturing and get into EV manufacturing / marketing. 

A p r stunt from a cupid .....

1 hour ago, FlorC said:

So US tariffs bad , Thaksin's tariffs good ?

Same-same, but different...

Good idea

For both countries 🧡

5 hours ago, edwinchester said:

So Thailand negotiates a FTA then decide they don't like it and decide they want to increase tariffs. It's deja-vu all over again.

Tacksin better be careful here  because he's playing with the big boys China and U.S. and he might get his ar$e kicked here.

11 hours ago, webfact said:

Thaksin proposes a hefty excise tax on imported EVs

Is he in the government? 

5 minutes ago, JJ-Thailand said:

Is he in the government? 

 

 

He moves in mysterious ways.

Thaksin is irrelevent &  the PM is only a caretaker, yet there is no rush whatsoever to find a worthy leader that the people should have voted  for..

The country is in disarray & needs competant management & all the old foggys in parliament, who have  been there for years need to go so fresh ideas & direction is found, as this is where most of the problems are created...

Not so long ago the people voted in a competant young man but parliament would not accept him, and he was banished from politics...

Since then 2 more contenders have fallen, and this will continue as long as there are so many back stabbers & jealousy involved..

And the thai people will be the ones to suffer...

Tax plan lol

 

So... tarrifs 

Finally wake up .. but can he bite the hand that feeds and shielded him???? 🤣

12 hours ago, ukrules said:

This is exactly the kind of behaviour that encourages reciprocal tariffs - but this time they're playing with both the US and China.

Thailands domestic auto manufacturing/assembly being screwed by cheap subsidised Chinese EV's

 

Will someone please shut this guy up?

4 hours ago, Ralf001 said:

 

Thailand had an FTA with Australia.

 

Ford Thailand imported Ford Territory vehicles.... with interior excises/taxes they hit the ford showrooms at 3 million baht.... nearly triple the aus price !

Australia is quite poor at negotiating FTAs. Apart from China and Japan I believe every other FTA has resulted in a trade deficit for Australia. All are not strictly FTAs as many still allow some tariffs and import quotas on Australian products.

If memory serves me correctly The Thai govt moved the goal posts when Australia started to export Territories resulting in a higher tax, to which the weak Australian government did nothing. Currently Australia is still negotiating an FTA with the EU and debating whether we can call Australia camembert cheese camembert. We already caved in years ago to champagne now called Australian sparkling wine. Ironic when the process known as methode champanois was developed by an Englishman and copied by the French, as was the bottle strong enough to hold the carbonation.

Who elected this guy PM?

Poor guy that ran away from Thailand for 15 or 17 years then says hey I just wanna spend time with my grandkids swimming in my pool it’s amazing how he’s so involved in the politics what is Thornton does he have to be making up these policies the whole thing should be embarrassing to Thailand a guy runs away from serving time in jail he stops his jet and Cambodia to party with his friend the night before he returns and then when he returns it so ill deathly ill he has to be in the hospital a VIP suite for six months I like how the Cambodian guy said that when he was at his house before they took pictures they had to put on his arm brace and his neck brace he said it was all just a show for the photographer what is wrong with these people don’t they see what this guy is all about he’s like a street sign one way TIT 

8 hours ago, BritScot said:

He just so happens to be the man who rescued Thailand from Military incompetent rule and the baht crash. The only person who can hold his head up with GDP figures of over 14%, and the highest English proficiency results in Thailands history.

What does all this mean??  GDP being 14% of what exactly? 

2 hours ago, Johno57 said:

a worthy leader that the people should have voted  for..

What on earth does this mean, please??? 

6 hours ago, Ralf001 said:

Ford Territory vehicles

What the … are these Territorial Vehicles, please!! ???  

9 hours ago, edwinchester said:

So Thailand negotiates a FTA then decide they don't like it and decide they want to increase tariffs. It's deja-vu all over again.

If it's deja-vu it kind of has to.