Article

Thailand EV Profile: EV Sales To Reach 4% Of New Vehicle Sales In 2023

Autos / Thailand / Thu 02 Mar, 2023

Key View: The plug-in hybrid electric vehicle market share in relation to battery electric vehicles will lose ground throughout our 2023-2032 forecast period, as an improvement in the penetration of public charging infrastructure, local automakers ramping up production of electric vehicles and the introduction of consumer-focused incentives will raise demand for electric vehicles going forward. Thailand will remain the largest electric vehicle market in the South East Asia region going forward, as prospects of consumer-focused incentives will supplement already existing incentives for automakers to produce electric vehicles locally.

Passenger Electric Vehicles

Electric Vehicle Market - Historical Data And Forecasts (Thailand 2021-2032)

Indicator202120222023f2024f2025f2026f2027f2028f2029f2030f2031f2032f
Passenger electric vehicle sales, units12,84132,14838,80042,12342,72842,59043,02343,77044,69145,83047,21448,871
Passenger electric vehicle sales, % y-o-y18.8150.420.78.61.4-0.31.01.72.12.53.03.5
Passenger battery electric vehicle sales, units5,78120,81729,10033,69836,31937,90538,72140,26841,56343,53945,79848,382
Passenger battery electric vehicle sales, % y-o-y92.8260.139.815.87.84.42.24.03.24.85.25.6
Passenger plug-in hybrid electric vehicle sales, units7,06011,3319,7008,4256,4094,6854,3023,5023,1282,2921,416489
Passenger plug-in hybrid electric vehicle sales, % y-o-y-9.660.5-14.4-13.1-23.9-26.9-8.2-18.6-10.7-26.7-38.2-65.5
f = Fitch Solutions forecast. Source: Electric Vehicle Association Of Thailand, Fitch Solutions

Latest Developments And Key Drivers

  • We have previously noted that Thailand has increased its attractiveness through incentives as an electric vehicle (EV) production base in the South East Asia region, which would in turn offer the market lower import duties and more affordable locally produced EVs.
  • The Thai government has granted further investment privileges to automakers looking to set up EV production in the market, we believe this will result in lower prices as a reduction in excise duties for locally made EVs plus the absence of high import duties results in lower prices for consumers.
  • A reduction of up to 40% of import duties for battery electric vehicles (BEVs) with a value of less than TBH2mn (USD60,000) and with a further reduction of 20% on import duties for BEVs that are priced between TBH2mn and TBH7mn (USD60,000-USD210,000) has been introduced.
  • The Thai government has introduced a subsidy program ranging between TBH70,000-TBH150,000 (USD2,140-USD4,600) of which passenger vehicles with a battery size of no more than 30KWh and over 10KWh are eligible for a TBH70,000 subsidy while PVs with a battery size exceeding 30KWh will be eligible for a TBH150,000 subsidy.
  • E-motorcycle purchases will be eligible for a TBH18,000 (USD550) subsidy for two-wheeled vehicles with a price tag of up to TBH (USD4,600).
  • Due to the presence of incentives, we forecast total EV sales to rise by 20.7% in 2023 and reach around the 38,800-unit mark, led by an increase in BEV sales which are set to rise by 38.9% to reach a total of 29,100 units. Over our 2023-2032 forecast period, total EV sales will reach just over 48,382 units, representing roughly 4.8% of total vehicle sales. We note that upside potential remains plentiful in Thailand's EV market as affordability has improved with the introduction of import duty reductions and cash incentives for EV purchases.
  • In 2019, Thailand introduced measures to cut import duties on EVs imported from Mainland China under a trade agreement which has been a success, with EV sales surpassing the critical 1,000 units mark as result. According to data released by the Department of Land Transport, BEV sales expanded by 370.0% to reach 1,572 units in 2019.
  • BYD has officially launched its operations in Thailand. Rever Automotive has been appointed the Chinese EV local partner and distributor. The company will invest over THB3bn (USD80mn) and the funds will be used to purchase additional vehicles from China as well as to carry out marketing plans in Thailand.
  • EV Primus, Thailand's importer and distributor of Dongfeng Sokon Automobile (DFSK) vehicles, has announced plans for local assembly. The company, which recently unveiled the Volt City EV, intends to begin producing EVs in Thailand in September 2023. EV Primus is investing THB400.0mn baht (USD11.0mn) to build an EV factory in Chachoengsao's Gateway City Industrial Estate.
  • According to Thailand's most recent insurance registration records, BYD's ATTO 3 model was the best-selling pure EV in January 2023, with 1,040 vehicles delivered. In January, BYD became Thailand's sole EV sales champion. The company's success in the Thai market is due to large-scale ATTO 3 exports, with over 10,000 vehicles shipped so far.
  • On February 2, 2023, Thailand's national committee on EV policy agreed in principle on a proposal to reduce the excise tax on EV batteries from 8% to 1% while providing a THB24.0bn (USD680mn) subsidy to the EV battery-producing industry. A factory producing an EV battery with a capacity less than 8GWh will receive a subsidy ranging from THB400 (USD11.3) to THB600 (USD17.0) per kWh, while a factory producing an EV battery with a capacity greater than 8GWh will receive a subsidy ranging from TBH600 (USD17.0) to TBHB800 (USD22.6) per kWh.
  • Volvo Cars (Thailand) is reportedly considering selling EVs only in Thailand amid a rapid surge in EV adoption aided by the introduction of incentives and rising purchasing power.

Commercial Electric Vehicles

Latest Developments And Key Drivers

(Light commercial EVs are all goods vehicles, heavy commercial EVs are buses only)

  • Isuzu is waiting for the right time to launch electric pickups and trucks in Thailand, where the market is currently dominated by passenger EVs. In Thailand, Isuzu focuses on commercial vehicles, particularly pickups and mid-sized to large trucks. Before the company plans to introduce electric versions of these vehicles in the country, it must ensure that charging stations are widely available.
  • In Thailand's capital, Bangkok, 1,250 electric buses are set to replace old diesel buses. The number of electric buses in the Bangkok metropolitan area will be increased to 8,000 within three years. According to reports citing the Thai Ministry of Transport and the Bangkok Mass Transit Authority (BMTA), bus routes in Bangkok are increasingly being electrified, most recently route 515, which is operated by Thai Smile Bus (TSB) and several other electric routes in the capital. TSB recently expanded its business by acquiring 21 bus and boat operators, resulting in the TSB network now operating on 120 bus routes and three water routes.

EV Fleet & Charging Network

Latest Developments And Key Drivers

  • PTT Oil and Retail Business (OR) previously announced plans to increase the number of EV charging stations from 107 to 450 by the end of 2022. By 2030, the company hopes to have 7,000 employees.
  • ThaiBev will expand into the field of electric vehicle charging stations. The company is researching the new venture and intends to install two charging stations at KFC locations in Thailand by 2022. If the trial is successful, ThaiBev intends to begin full-scale deployment in 2023 at existing stores as well as larger commercial centres.

EV Market Share To Expand Over The Long Term

Thailand - EV Fleet By Type And EV Fleet Penetration (2021-2032)

e/f = Fitch Solutions estimate/forecast. Source: Department Of Land Transport, Fitch Solutions

This commentary is published by BMI, a Fitch Solutions company, and is not a comment on Fitch Ratings Credit Ratings. Any comments or data included in the report are solely derived from BMI and independent sources. Fitch Ratings analysts do not share data or information with BMI. Copyright © 2023 Fitch Solutions Group Limited. All rights reserved. 30 North Colonnade, London E14 5GN, UK.

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