Thailand Targets 30% Electric-Car Production to Tackle Pollution

Thailand will target having electric vehicles account for 30% of car production by the end of the decade, as part of efforts to tackle toxic air pollution.

The government wants to “accelerate the use and production of electric vehicles, with national strategies focusing on the environment and air pollution solutions,” Industry Minister Suriya Juangroongruangkit said in an interview. Thailand already has an advantage by being a car-production hub and it’s now time to focus on EVs, he said.

While the overall contribution from vehicles to pollution is much smaller than other sources like crop burning or forest fires, a survey commissioned by Nissan Motor Co. showed that 91% of Thais would buy an EV because of the environmental impact. The survey found 43% of Thai non-EV owners would consider an EV for their next car purchase within the next three years.

Some of the measures to stimulate the domestic market and achieve the 2030 goal include encouraging the use of electric vehicles by state agencies, tax benefits and parking discounts for buyers, more investment incentives for companies, and developing charging infrastructure across the country, Suriya said. The 30% target will include cars, motorbikes and buses, he added.

Such initiatives would support continued growth of EV sales in Thailand, Allen Abraham, an analyst at BloombergNEF, wrote in a Feb. 4 report. While the Thai EV market is still small, it showed “great resilience” last year despite the pandemic denting overall auto sales, Abraham said. EV car sales increased 1.4% in 2020, while regular auto sales slumped 26%.

Thailand’s Board of Investment has already granted EV privileges to more than a dozen companies, including Nissan, Toyota Motor Corp., Mercedes-Benz AG, BMW AG, and Energy Absolute Pcl’s Mine Mobility. In November, the government approved new incentives to boost production of EVs and its supply chain, including a three-year tax holiday for manufacturers of plug-in hybrid vehicles, and an eight-year corporate income tax waiver for battery electric vehicle makers.

©2021 Bloomberg L.P.

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