Is It Me, Or Are Car Prices Too High!

[Plus]

Mercedes Benz, with starting prices of around 70,000 USD, is one of the ten top selling brands.

People certainly have got money, and the government likes milking them with higher taxes. It will be another two thousand years before Thais will protest over high taxes.

I think it's not too many cars - it's too few roads, I wonder what they spend that tax money on.

[wilko]

Mercedes Benz, with starting prices of around 70,000 USD, is one of the ten top selling brands.

People certainly have got money, and the government likes milking them with higher taxes. It will be another two thousand years before Thais will protest over high taxes.

I think it's not too many cars - it's too few roads, I wonder what they spend that tax money on.

<{POST_SNAPBACK}>

What source/stats do you base that assumption on???????

[Plus]

Bangkok Post publishes monthly sales figures, so do many Thai auto magazines.

Some time ago I read an article about consulting company hired by BMA - they said that for the traffic to flow smoothly there needs to be 20m of road per car, in Bangkok it's about 7-9m. With car sales hittting 600,000 per year Thailand needs to build a certain amount of roads annually. Just to park them we need 3,000km (one car - 5m) of one lane roads, every year.

[Simbo]

OK, Cars imported into Thailand have a very high customs duty attatched. But what about the ones that are manufactured here in Thailand? There are currently 30 companies including Mercedes that make their cars here in LOS!  Shouldn't they be reasonably priced? Riddle me that one if you will?

<{POST_SNAPBACK}>

I'll think you will find, the likes of Mercedes come into Los CKD and are just assembled here, so although less import duty is charged, the imported bits are.

[Kerryd]

A couple of weeks ago there was a thread about the cost of importing vehicles to Thailand.

Here is a link to the Thai site that shows how they calculate the import duties and taxes:

Thai Customs Site

An example of the cost of importing a used vehicle:

"Example Calculation of Taxes and Duties

The following example shows a breakdown of the liable taxes and duties assessed on the vehicles less than 2400 c.c. cylinder capacity with a CIF value (CIF value (Cost & Insurance & Freight) of 1,000,000 Baht.

Total taxes and duties = 1+2+3+5 = 2,131,707.20 Baht

As you can see, the cost of importing the vehicle (in this case) is over twice the value of the vehicle itself !

There is a discount noted, depending on the age of the vehicle. I think it works out to about 55% if the vehicle is over 5 years old. That still means you would still be paying over 1 million baht in duties/taxes, for a vehicle that's valued at less than that (remember the CIF value is the vehicle cost PLUS Insurance PLUS freight).

[bkk_mike]

I know a guy with a 4 wheel drive pick up who doesn't live on a farm or have a buffalo   Why?

<{POST_SNAPBACK}>

Because you get a lot of pickup for your money - as they're on the lowest tax bracket.

i think the duty on Japanese cars above 3,000 cc are going to be cut from 80% to 60%, and over something like 4 or 5 years.  its not going from 80% to 0% like you say. 

interesting to note also that the duty used to be 60% in pre-crisis days, the govt raised it to 80% during the crisis to discourage excessive import spending.  now that the crisis is over, i wonder why they haven't reverted to the old rate.  it would certainly give a boost to the car industry.

<{POST_SNAPBACK}>

Is this only on new or used also? And with used cars does anyone know how they figure what price to put the tax on?

<{POST_SNAPBACK}>

Only new cars have duty on them. It's the high new price that keeps the used prices high. (But reducing the import duty WILL lower the price of new imported vehicles, so the used price should drop by a similar margin.)

And I said that Japan was trying to get the same deal that Australia has - where import duty dropped to zero % on cars with engines over 3.0l (but that Mercedes and BMW were already complaining that it would be a problem for them). If they've come to an agreement of 60% - that's probably to keep Mercedes/BMW happy, while letting the Japanese car makers have a little benefit from the FTA.

However the car taxes, even without import duty, are still high enough that any large-engined car still won't be cheap compared to Europe/US. (Car - not pickup/SUV - as they have fairly low car taxes.)

Edited August 24, 2005 by bkk_mike