The Thai government will extend the deadline for electric vehicle (EV) manufacturers to meet local production targets, according to the Board of Investment (BoI) on Wednesday.
Under the current EV 3.0 incentive program, companies are required to produce one EV locally for every vehicle they imported earlier. For those firms unable to meet this 1:1 target this year, the local production requirement will increase to 1.5 vehicles for each imported unit starting in 2025.
This policy aims to encourage more EV manufacturers to seek incentives for establishing local assembly plants, leading to approximately 80 billion baht in investments in EV and related parts manufacturing.
The BoI announced that local EV producers will now have until the end of 2027 to fulfill the local output requirements.
These measures are part of broader efforts to support a challenging automobile sector that faces difficulties due to a stagnant domestic market amid slow economic growth and tight credit conditions.
The Federation of Thai Industries (FTI) recently revised its domestic car manufacturing target for 2024, lowering it from 1.7 million units to 1.5 million, marking the lowest target since 2021, as car sales in the domestic market continue to remain weak.
In the first ten months of this year, total car sales (both conventional and EV) fell by 26.2% year-on-year to 476,350 units, with pickup sales dropping by 43%.
This decline has been attributed to stricter auto loan approval criteria from banks, concerned about rising bad debts amidst the country’s high household debt levels.
