Why Are New Cars So Overpriced In Thailand

[sotsira]

Been looking at the specs of the Honda Accord and Toyota Camry websites

and i was astonished to see the starting prices in $ compared to Thailand Baht

is half the price of what they are sold for in Thailand.

I was also under the impression that these cars are assembled in Thailand to reduce costs

so why are they twice the price of what they are in the US?

Here are the links for those who are interested:

http://www.toyota.co...ims-prices.html

http://automobiles.h...m/accord-sedan/

Both these cars are sold in Thailand at the average price of 1.7M bt

The Camry top of the range V6 is 2.7M bt

[aussiebebe]

Hi, why not reverse your question? Why are cars so cheap in the US? It's a huge market, with much greater competition between dealers and manufacturers both domestic and international; almost all cars are sold below suggested retail prices. Last decade, GM and Ford used to make so much profit from SUVs that they'd sell compacts at a loss unless the customer added options. They did this to lower their fleet-average fuel economy within Federal limits. Thailand has less consumers than the US which means wider margins as there is less competition.This is true for cars and electronics - all much cheaper in US compared with Thailand or Europe for that matter.

The US prices you see for cars may not include State sales taxes which may be none to 8.5%, or delivery/registration charges, but Thai prices are comprehensive.

The larger number of brands and models in the US means more advertising competiton. Although most of the US car industry is unionised -people used to joke that GM is the world's largest health-care provider that makes cars on the side at a time when they were the biggest car manufacturer in the world - there are some non-union car plants. Also more suppliers from Mexico and Brazil, besides the actual assembly plants there, means competition to lower component costs.

As for Thailand, you're right that Honda and Toyota are assembled in Thailand so have a lower rate of tax than imported cars, however perhaps someone else knows whether the V6 engines on the top-end Camry/Accord are imported? I don't know but this may explain the high price also.

[katabeachbum]

Hi, why not reverse your question? Why are cars so cheap in the US? It's a huge market, with much greater competition between dealers and manufacturers both domestic and international; almost all cars are sold below suggested retail prices. Last decade, GM and Ford used to make so much profit from SUVs that they'd sell compacts at a loss unless the customer added options. They did this to lower their fleet-average fuel economy within Federal limits. Thailand has less consumers than the US which means wider margins as there is less competition.This is true for cars and electronics - all much cheaper in US compared with Thailand or Europe for that matter.

The US prices you see for cars may not include State sales taxes which may be none to 8.5%, or delivery/registration charges, but Thai prices are comprehensive.

The larger number of brands and models in the US means more advertising competiton. Although most of the US car industry is unionised -people used to joke that GM is the world's largest health-care provider that makes cars on the side at a time when they were the biggest car manufacturer in the world - there are some non-union car plants. Also more suppliers from Mexico and Brazil, besides the actual assembly plants there, means competition to lower component costs.

As for Thailand, you're right that Honda and Toyota are assembled in Thailand so have a lower rate of tax than imported cars, however perhaps someone else knows whether the V6 engines on the top-end Camry/Accord are imported? I don't know but this may explain the high price also.

all cars in Thailand with more than 3000cc or 220 hp are in a very high excice tax bracket, thus the huge difference in price when passing these engine limits.

If you think Thai made Accords and camrys are expensive, have a look at Thai essambled BMW and Benz. A Benz E200 with 1800cc engine costs 3,5-4 million baht, Accord with same power (2400cc) and similar spec is 1,5 million baht

[MoonRiverOasis]

One word: Tax

http://www.thaivisa.com/forum/topic/435479-taxes-on-cars-in-thailand/

[aussiebebe]

One word: Tax

http://www.thaivisa....rs-in-thailand/

Thanks for posting that thread, I'd never seen it before and didn't know anything about how cars are taxed. Having read it I agree that tax is the main reason for high prices in Thailand, but I still think that US cars are unusually cheap. Thanks again!

[Badbanker]

After you have driven your new USA Camry for 5 years, in the USA, its value is a great deal less than if you bought a similar car in Thailand and drove it for 5 years!

A great many cars in Thailand are around for 20-30 year again unlike the USA.

Go back to the USA if you don't like prices here!

BB

[culicine]

Just compare service costs over a 5 - 10 year period and also consider depreciation. 15 years ago my mini costs 40-50 dollars an hour to service in Australia. I dread to think what it is now. My honda in Thailand is about 300 baht an hour or so. Depreciation here is also not as drastic. I think for regular cars, over the long run, they are cheaper in LoS than in many western countries.

[aussiebebe]

I agree about lower labour costs and depreciation but if you look at the thread link above it has a really interesting table showing taxes and the V6 Camry and Accord which the guy was asking about do indeed have shockingly high taxes.

I guess people only consider them as they have better features than any other sedan you could buy for the money in Thailand. It's probably better to have a V6 with lower servicing costs than a four-pot 3-series or C-class for the same price, I don't know.

[WarpSpeed]

After you have driven your new USA Camry for 5 years, in the USA, its value is a great deal less than if you bought a similar car in Thailand and drove it for 5 years!

A great many cars in Thailand are around for 20-30 year again unlike the USA.

Go back to the USA if you don't like prices here!

BB

Standard issue, nonsensical, knee jerk, answer..

The long term resales prices here are overinflated too so it's all relative..And then there's a much less appointed car available here in most cases on top of all that which hasn't even been mentioned in the OP.

[katabeachbum]

After you have driven your new USA Camry for 5 years, in the USA, its value is a great deal less than if you bought a similar car in Thailand and drove it for 5 years!

A great many cars in Thailand are around for 20-30 year again unlike the USA.

Go back to the USA if you don't like prices here!

BB

Standard issue, nonsensical, knee jerk, answer..

The long term resales prices here are overinflated too so it's all relative..And then there's a much less appointed car available here in most cases on top of all that which hasn't even been mentioned in the OP.

Car ownership in Thailand is in my experience extremely inexpensive

Take a volume seller like Vigo 4x4 auto 3,0D4D 4 door G at 950 k baht. I m on my 3rd one pluss one Fortuner sibling, so 4.

Interest on 75% financed is 2,5%. Resale after 3 years is 65-70%, IOW loss of approx 300k baht.

maintance 3 years/60k km is 10k baht. Fuel cost todays fuel prices, 34 baht/10 km, thats 5,44 baht/mile

1 st class Insurance is approx 20k a year, and if you are to blame in an accident it costs you 2k baht.

Now lets look at my 2008 Accord 2,4. Purchased at 1,5 million baht. Did 70k km in 14 months (commuting Phuket Hua Hin 1400k roundtrip). Insurance included, maintance 15k baht, and sold at 1.230.000.

Figures for my 2007 Camry 2,4 similar. 14 months, purchased at 1,5 sold at 1,3 and maintance during 40k km was 8k baht.

Maintance includes waxing every 3 months

purchase prices are higher than in some markets, total costs are very low.

[samran]

simple rule of thumb.

'The west' - generally cheaper to buy, more expensive to run and service. Huge depreciation on resale.

Thailand - More expensive to buy, less expensive to run, dead cheap to service. A well serviced car will hold its value.

I'm not a motor-head so I'm happy to buy a good second hand car, generally in cash, use it for a couple of years (well maintained) and then resell it for not much less than I bought it for.

Much better for the finances, and if you look at it that way, cars in Thailand aren't expensive at all...

[trogers]

I would understand the need for a large engine vehicle in the West due to snowy conditions, but I do not understand the same needs in the tropics. I had driven my 1.3 lit Honda City to Singapore and back without any problems.

So why is there bickering about overpriced large capacity cars in Thailand due to high excise taxes?

[katabeachbum]

I would understand the need for a large engine vehicle in the West due to snowy conditions, but I do not understand the same needs in the tropics. I had driven my 1.3 lit Honda City to Singapore and back without any problems.

So why is there bickering about overpriced large capacity cars in Thailand due to high excise taxes?

Guess it depends on what speed you require. My 2008 Accord 2,4 with 180 hp was just adequate to cruise 160kmh and occasional 180 kmh. Overtakingpower just sufficient to be safe.

My 2010 Vigo 3,0 D4D is just sufficient to cruise 160 kmh, but often reduce to 140 kmh when loaded with big bikes and stuff. In short the new Ford Ranger will be available with a more powerfull 3,2 and I m looking to trade

Due to thais driving, it actually requires more power to obtain 160 kmh cruisingspeed on LOS Highways than 180 kmh on German Autobahn

[samran]

I would understand the need for a large engine vehicle in the West due to snowy conditions, but I do not understand the same needs in the tropics. I had driven my 1.3 lit Honda City to Singapore and back without any problems.

So why is there bickering about overpriced large capacity cars in Thailand due to high excise taxes?

out of interest, how easy/hard was it to get a Thai registered vehicle into Singapore?

[trogers]

I would understand the need for a large engine vehicle in the West due to snowy conditions, but I do not understand the same needs in the tropics. I had driven my 1.3 lit Honda City to Singapore and back without any problems.

So why is there bickering about overpriced large capacity cars in Thailand due to high excise taxes?

out of interest, how easy/hard was it to get a Thai registered vehicle into Singapore?

Not difficult. If you can get it into Malaysia, you can get it into Singapore, but you will need to rent and fit out the car with a card reader at the Johore-Singapore Causeway as most highways in Singapore carry charges during certain periods of the day. Check with the Malaysian Embassy at Sathorn on their requirements.

[samran]

I would understand the need for a large engine vehicle in the West due to snowy conditions, but I do not understand the same needs in the tropics. I had driven my 1.3 lit Honda City to Singapore and back without any problems.

So why is there bickering about overpriced large capacity cars in Thailand due to high excise taxes?

out of interest, how easy/hard was it to get a Thai registered vehicle into Singapore?

Not difficult. If you can get it into Malaysia, you can get it into Singapore, but you will need to rent and fit out the car with a card reader at the Johore-Singapore Causeway as most highways in Singapore carry charges during certain periods of the day. Check with the Malaysian Embassy at Sathorn on their requirements.

Thanks for that. You've made my day!

Have driven to KL before, it was a wonderful trip. Am keen to go all the way to Singapore next time.

[WarpSpeed]

simple rule of thumb.

'The west' - generally cheaper to buy, more expensive to run and service. Huge depreciation on resale.

Thailand - More expensive to buy, less expensive to run, dead cheap to service. A well serviced car will hold its value.

I'm not a motor-head so I'm happy to buy a good second hand car, generally in cash, use it for a couple of years (well maintained) and then resell it for not much less than I bought it for.

Much better for the finances, and if you look at it that way, cars in Thailand aren't expensive at all...

Yes, this is what I said, one doesn't need to be a motor head to be good at finances and see savings in a plan. It's all relative as I said previously, it's most definitely NOT significantly cheaper to own a car here as has been suggested. The only way it would be is if there was a significant savings in operating costs in terms of disposables, I.E. fuel for example and there isn't anymore since subsidizing was lifted..

I've managed however to take advantage of that additional savings too by only buying LP converted cars when I purchase (not converting them myself and letting the person prior take the loss) and like you not driving them forever or until they become large financial liabilities in repairs or whatever, works really well so far..

[Sophon]

simple rule of thumb.

'The west' - generally cheaper to buy, more expensive to run and service. Huge depreciation on resale.

Thailand - More expensive to buy, less expensive to run, dead cheap to service. A well serviced car will hold its value.

I'm not a motor-head so I'm happy to buy a good second hand car, generally in cash, use it for a couple of years (well maintained) and then resell it for not much less than I bought it for.

Much better for the finances, and if you look at it that way, cars in Thailand aren't expensive at all...

Yes, this is what I said, one doesn't need to be a motor head to be good at finances and see savings in a plan. It's all relative as I said previously, it's most definitely NOT significantly cheaper to own a car here as has been suggested. The only way it would be is if there was a significant savings in operating costs in terms of disposables, I.E. fuel for example and there isn't anymore since subsidizing was lifted..

I've managed however to take advantage of that additional savings too by only buying LP converted cars when I purchase (not converting them myself and letting the person prior take the loss) and like you not driving them forever or until they become large financial liabilities in repairs or whatever, works really well so far..

It really doesn't make any sense to compare prices in Thailand to "the west", as the prices in western countries are very different. Compared to my home country the prices of cars in Thailand are significantly cheaper, resale value is much better, servicing is a fraction of the cost of back home and fuel is close to half price. So from my perspective it definitely IS significantly cheaper to own a car in Thailand. But I realize that the situation is very different for others, especially people from the U.S.

Sophon

[PattayaParent]

In word exchange rate (well 2 words then)

When I bought a new car here 15 years ago the exchange rate was 80 baht to the Quid, when I bought another new one a couple of years ago it was 50 Baht to the Quid.

But the price in Baht was exactly the same. Can you say the same in US or UK?

[katabeachbum]

simple rule of thumb.

'The west' - generally cheaper to buy, more expensive to run and service. Huge depreciation on resale.

Thailand - More expensive to buy, less expensive to run, dead cheap to service. A well serviced car will hold its value.

I'm not a motor-head so I'm happy to buy a good second hand car, generally in cash, use it for a couple of years (well maintained) and then resell it for not much less than I bought it for.

Much better for the finances, and if you look at it that way, cars in Thailand aren't expensive at all...

Yes, this is what I said, one doesn't need to be a motor head to be good at finances and see savings in a plan. It's all relative as I said previously, it's most definitely NOT significantly cheaper to own a car here as has been suggested. The only way it would be is if there was a significant savings in operating costs in terms of disposables, I.E. fuel for example and there isn't anymore since subsidizing was lifted..

I've managed however to take advantage of that additional savings too by only buying LP converted cars when I purchase (not converting them myself and letting the person prior take the loss) and like you not driving them forever or until they become large financial liabilities in repairs or whatever, works really well so far..

Fuel in Thailand is half the price of fuel in most of Europe

Purchase price of cars in Thailand is half the price of severeal countries in Europe

100k maintance of a car in Thailand is the same as 10k maintance in Europe

Insurance is less

Loss of value is half

I d say there is a substantial saving on car ownership here

[thunder30101]

Thailand as a country relies on corporate taxes which makes all imported goods very expensive including every part on your car that is imported. It is quite a change from my home country where corporations pay nothing and goverment runs on personal taxes making things seem cheaper but as the post above says it all evens out in the end.

[WarpSpeed]

simple rule of thumb.

'The west' - generally cheaper to buy, more expensive to run and service. Huge depreciation on resale.

Thailand - More expensive to buy, less expensive to run, dead cheap to service. A well serviced car will hold its value.

I'm not a motor-head so I'm happy to buy a good second hand car, generally in cash, use it for a couple of years (well maintained) and then resell it for not much less than I bought it for.

Much better for the finances, and if you look at it that way, cars in Thailand aren't expensive at all...

Yes, this is what I said, one doesn't need to be a motor head to be good at finances and see savings in a plan. It's all relative as I said previously, it's most definitely NOT significantly cheaper to own a car here as has been suggested. The only way it would be is if there was a significant savings in operating costs in terms of disposables, I.E. fuel for example and there isn't anymore since subsidizing was lifted..

I've managed however to take advantage of that additional savings too by only buying LP converted cars when I purchase (not converting them myself and letting the person prior take the loss) and like you not driving them forever or until they become large financial liabilities in repairs or whatever, works really well so far..

It really doesn't make any sense to compare prices in Thailand to "the west", as the prices in western countries are very different. Compared to my home country the prices of cars in Thailand are significantly cheaper,

Sophon

So then you're suggesting that the packages available to you here are the same as the west?? Once again we need to keep things in perspective as I'm not referring to Europe but the US as in the OP of which there is NO valid comparison, the packages available there be it first or second hand are much more comprehensive..

[WarpSpeed]

simple rule of thumb.

'The west' - generally cheaper to buy, more expensive to run and service. Huge depreciation on resale.

Thailand - More expensive to buy, less expensive to run, dead cheap to service. A well serviced car will hold its value.

I'm not a motor-head so I'm happy to buy a good second hand car, generally in cash, use it for a couple of years (well maintained) and then resell it for not much less than I bought it for.

Much better for the finances, and if you look at it that way, cars in Thailand aren't expensive at all...

Yes, this is what I said, one doesn't need to be a motor head to be good at finances and see savings in a plan. It's all relative as I said previously, it's most definitely NOT significantly cheaper to own a car here as has been suggested. The only way it would be is if there was a significant savings in operating costs in terms of disposables, I.E. fuel for example and there isn't anymore since subsidizing was lifted..

I've managed however to take advantage of that additional savings too by only buying LP converted cars when I purchase (not converting them myself and letting the person prior take the loss) and like you not driving them forever or until they become large financial liabilities in repairs or whatever, works really well so far..

Fuel in Thailand is half the price of fuel in most of Europe

Purchase price of cars in Thailand is half the price of severeal countries in Europe

100k maintance of a car in Thailand is the same as 10k maintance in Europe

Insurance is less

Loss of value is half

I d say there is a substantial saving on car ownership here

I hate to keep reiterating this to our European members but here's the quote from the OP..

I was also under the impression that these cars are assembled in Thailand to reduce costs

so why are they twice the price of what they are in the US?

Therefore what experience with the US market do you base your continued contradiction on?

[SantiSuk]

What crazy schmuk drives at a cruising speed of 160kph. Far too expensive on fuel at those levels (probably 30-40% more than at legal limits).

Relax - this is Thailand - you have time .

[Sophon]

It really doesn't make any sense to compare prices in Thailand to "the west", as the prices in western countries are very different. Compared to my home country the prices of cars in Thailand are significantly cheaper,

Sophon

So then you're suggesting that the packages available to you here are the same as the west?? Once again we need to keep things in perspective as I'm not referring to Europe but the US as in the OP of which there is NO valid comparison, the packages available there be it first or second hand are much more comprehensive..

No, I'm not suggesting that the packages are the same, but they don't have to be for me to recognize that the prizes in Thailand are significantly cheaper. As an example the cheapest Honda Jazz back home costs (at current exchange rate) THB 965,000 and that is for a 1.2 with manual transmission. I'm sure it's superior to Thai models in some aspects (e.g. safety features), but I challenge you to argue that this isn't more expensive than the prize for a Honda Jazz in Thailand.

Sophon

[katabeachbum]

No, I'm not suggesting that the packages are the same, but they don't have to be for me to recognize that the prizes in Thailand are significantly cheaper. As an example the cheapest Honda Jazz back home costs (at current exchange rate) THB 965,000 and that is for a 1.2 with manual transmission. I'm sure it's superior to Thai models in some aspects (e.g. safety features), but I challenge you to argue that this isn't more expensive than the prize for a Honda Jazz in Thailand.

Sophon

The cheapest Jazz in Thaland at approx 550k baht comes with a 120 hp 1,5 and dual airbags. Comparing prices should be done with same spec

Cars er very cheap in the US, they also have rather expensive Insurances and maintance and a huge loss of value in 3 years.

Lets compare a car available in LOS and the US with similar spec, Camry Hybrid. Whats the US price included taxes, and Insurance for a 22 year old driver, and whats the costs over 3 years, and resale (lease rest value) after 3 years? I would guess Thai ownership is less expensive

[Sophon]

No, I'm not suggesting that the packages are the same, but they don't have to be for me to recognize that the prizes in Thailand are significantly cheaper. As an example the cheapest Honda Jazz back home costs (at current exchange rate) THB 965,000 and that is for a 1.2 with manual transmission. I'm sure it's superior to Thai models in some aspects (e.g. safety features), but I challenge you to argue that this isn't more expensive than the prize for a Honda Jazz in Thailand.

Sophon

The cheapest Jazz in Thaland at approx 550k baht comes with a 120 hp 1,5 and dual airbags. Comparing prices should be done with same spec

Cars er very cheap in the US, they also have rather expensive Insurances and maintance and a huge loss of value in 3 years.

Lets compare a car available in LOS and the US with similar spec, Camry Hybrid. Whats the US price included taxes, and Insurance for a 22 year old driver, and whats the costs over 3 years, and resale (lease rest value) after 3 years? I would guess Thai ownership is less expensive

I agree that optimally we should compare cars with same specs, but that is not always possible. In Denmark (where I come from) Honda don't sell the 1.5 version, since it would be too expensive to be able to sell. The closest version is a 99 hp 1.4 which costs (the cheapest manual version) THB 1,063,000.

So since every aspect of car ownership is cheaper in Thailand compared to Denmark, if like me you come from Denmark the price of owning a car in Thailand is very cheap (relatively). I realize that the picture isn't quite as clear if you (like he OP) comes from the U.S., hence my comment that it doesn't make any sense to compare prices in "the west" to prices in Thailand. You would have to compare for a specific country.

Sophon

Sphon

[katabeachbum]

No, I'm not suggesting that the packages are the same, but they don't have to be for me to recognize that the prizes in Thailand are significantly cheaper. As an example the cheapest Honda Jazz back home costs (at current exchange rate) THB 965,000 and that is for a 1.2 with manual transmission. I'm sure it's superior to Thai models in some aspects (e.g. safety features), but I challenge you to argue that this isn't more expensive than the prize for a Honda Jazz in Thailand.

Sophon

The cheapest Jazz in Thaland at approx 550k baht comes with a 120 hp 1,5 and dual airbags. Comparing prices should be done with same spec

Cars er very cheap in the US, they also have rather expensive Insurances and maintance and a huge loss of value in 3 years.

Lets compare a car available in LOS and the US with similar spec, Camry Hybrid. Whats the US price included taxes, and Insurance for a 22 year old driver, and whats the costs over 3 years, and resale (lease rest value) after 3 years? I would guess Thai ownership is less expensive

I agree that optimally we should compare cars with same specs, but that is not always possible. In Denmark (where I come from) Honda don't sell the 1.5 version, since it would be too expensive to be able to sell. The closest version is a 99 hp 1.4 which costs (the cheapest manual version) THB 1,063,000.

So since every aspect of car ownership is cheaper in Thailand compared to Denmark, if like me you come from Denmark the price of owning a car in Thailand is very cheap (relatively). I realize that the picture isn't quite as clear if you (like he OP) comes from the U.S., hence my comment that it doesn't make any sense to compare prices in "the west" to prices in Thailand. You would have to compare for a specific country.

Sophon

Sphon

agreed

Car ownership is less expenisve in LOS than in most countries. car purchase is less expensive in the US for some models

[WarpSpeed]

It really doesn't make any sense to compare prices in Thailand to "the west", as the prices in western countries are very different. Compared to my home country the prices of cars in Thailand are significantly cheaper,

Sophon

So then you're suggesting that the packages available to you here are the same as the west?? Once again we need to keep things in perspective as I'm not referring to Europe but the US as in the OP of which there is NO valid comparison, the packages available there be it first or second hand are much more comprehensive..

No, I'm not suggesting that the packages are the same, but they don't have to be for me to recognize that the prizes in Thailand are significantly cheaper. As an example the cheapest Honda Jazz back home costs (at current exchange rate) THB 965,000 and that is for a 1.2 with manual transmission. I'm sure it's superior to Thai models in some aspects (e.g. safety features), but I challenge you to argue that this isn't more expensive than the prize for a Honda Jazz in Thailand.

Sophon

So Is back home in the States then??

[WarpSpeed]

No, I'm not suggesting that the packages are the same, but they don't have to be for me to recognize that the prizes in Thailand are significantly cheaper. As an example the cheapest Honda Jazz back home costs (at current exchange rate) THB 965,000 and that is for a 1.2 with manual transmission. I'm sure it's superior to Thai models in some aspects (e.g. safety features), but I challenge you to argue that this isn't more expensive than the prize for a Honda Jazz in Thailand.

Sophon

The cheapest Jazz in Thaland at approx 550k baht comes with a 120 hp 1,5 and dual airbags. Comparing prices should be done with same spec

Cars er very cheap in the US, they also have rather expensive Insurances and maintance and a huge loss of value in 3 years.

Lets compare a car available in LOS and the US with similar spec, Camry Hybrid. Whats the US price included taxes, and Insurance for a 22 year old driver, and whats the costs over 3 years, and resale (lease rest value) after 3 years? I would guess Thai ownership is less expensive

Sure let's slant the specs in favor of your argument too while were at it?.. For starters how many people posting here are 22 years old ?? And then driving a top line Camry Hybrid to boot? It really is exhausting trying to converse with such slanted perspectives, it's too much for one logical and analytical person like myself to deal with honestly..