474% increase in electric vehicle sales in the first five months of the year
Sales of electric vehicles in Thailand soared by 474% in the first five months of this year. The rise was driven by the introduction of a tax credit for electric vehicles last November, data from the Department of Transportation show. The tax relief of 80% will be valid until November 10, 2025.
According to the Department of Land Transport, from January to the end of May this year, 32,450 electric vehicles were registered by owners. This is equivalent to a 474.43% increase in electric vehicle registrations compared to the previous year.
The Ministry of Transportation and the Department of Land Transport have implemented several measures to support the development of the electric vehicle industry and encourage the public to use electric vehicles, including a tax credit. The measure cuts the tax by 80% on electric vehicles to encourage Thais to buy them. For example, a regular 1.8 ton sedan would normally be charged an annual tax of 1,600 baht, but if it's an electric car, the tax would be only 320 baht. This tax benefit is valid for one year after registration.
The use of electric vehicles is being promoted to reduce exposure to air pollution, including PM2.5 fine dust. One of the causes of PM2.5 is internal combustion engines that emit exhaust fumes and fine dust. Electric vehicles can reduce air pollution because they do not emit exhaust gases or PM2.5.
The need to increase the number of charging stations for electric vehicles
To address this issue, the Provincial Electricity Authority (PEA) has announced plans to cooperate with all vehicle manufacturers to expand the network of charging stations.
Prasertsak Cherngchavano, Deputy Head of Strategic Planning for Power Generation at EGAT, noted that more countries are moving to electric vehicles in their pursuit of “clean energy”. With the country's continued growth in electric vehicle sales, Thailand is also making headway in this area, with all indicators pointing to further growth in the future.
However, Thailand still faces the problem of a limited number of electric vehicle charging stations, including a lack of them in private homes, unlike many other countries where such facilities are plentiful and convenient. In addition, charging electric vehicles at night can significantly reduce energy costs, making it more cost-effective.
In order to provide better coverage and integration, the five companies are now working on interconnecting electric vehicle charging station networks to provide a better user experience when accessing stations from different manufacturers.
It is assumed that all participating companies will be integrated into a single platform, allowing them to collaborate. For example, they will be able to use a common payment system within this platform. A similar example is the banking model, where customers can withdraw and transfer money through ATMs of different banks.
In addition, EGAT PJSC is preparing to increase the manageability of public sector energy consumption to achieve maximum efficiency and reduce carbon emissions by introducing the #5 label. The label, which will come into effect in September, will represent the value of reducing the carbon footprint of electrical appliances.
In addition, work is ongoing to expand green areas through a project to replenish forests and green spaces. In 2022, over 103,000 rai of forest land were added as a result of reforestation work. The goal for 2023 is 100,000 rai of reforested area, and the ultimate goal is to reach 1 million rai of reforested forest land by 2031.
Ministry of Industry pushes for extension of tax breaks for hybrid cars
The ministry is preparing a proposal to the Treasury Department's revenue department to extend the tax break by 2 years to give green car makers time to switch to electric vehicles, according to news reports.
The production plans of nine automakers (Nissan, Honda, Suzuki, Mitsubishi, Toyota, Ford, Mazda, MG, and VW) that produce plug-in hybrid vehicles have been hit by a global chip shortage over the past 2-3 years caused by large car factory shutdowns chip manufacturing during the COVID-19 crisis.
According to Surapong Paisitpattanapong, Vice President and Representative of the Automobile Club of the Federation of Industries of Thailand (FTI), the Green Car Project, a flagship program, has successfully promoted the affordability of passenger cars for consumers. This led to an increase in the share of domestic sales of passenger cars from 10% to 42-45%, as well as a continuous increase in car exports. Prices for affordable cars have been set in the range of 350,000 to 400,000 baht, as well as additional requirements for energy-efficient cars, including cars with a hybrid engine.
The exemptions provided by the tax department include tax exemptions of 50% and 25% for hybrid electric vehicles, respectively. The Ministry of Industry and the Institute of Physics and Technology are pushing for an extension of this exemption to mitigate the impact caused by the chip shortage and ensure the sustainability of the country's automotive industry.
Author of the article: Ekaterina Antonova
