BANGKOK, Aug 29 Thailand’s Board of Investment (BoI) has approved promotional privileges to produce the country’s second batch of eco-cars with a minimum investment capital of Bt6.5 billion.
Industry Minister Prasert Boonchaisuk said the application deadline was set for March 31 next year and manufacturing must begin in 2019. Existing and new manufacturers are welcome.
The production must include bodies, engines and parts with at least 100,000 units manufactured annually from the fourth year.
The new lot of eco-cars must be installed with Euro 5 engines emitting less than 100gm/km carbon dioxide and energy efficiency of 4.3 litres for 100km. The maximum engine size is 1300cc for gasoline and 1500cc for diesel.
Udom Wongviwatchai, BoI secretary general, said the new eco-car would be Bt10,000 more expensive than the present one but the Euro 5 engine is high in quality and fuel consumption is reduced from five litres to 4.3 litres per 100km.
He predicted manufacturers’ interest in manufacturing eco-cars in the next 5-6 years and expected full manufacturing capability to 580,000 units in 2016.
He said the BoI will encourage the use of locally-built parts with an additional year of income tax exemption for manufacturers using at least Bt500 million in local parts within five years.
If a manufacturer uses more than Bt800 million in local parts in five years, two more years income tax exemption will be added, or a total of eight years. Imports of production machinery will be exempted from duty – similar to the first batch.
Payungsak Chatsithipol, chairman of the Federation of Thai Industries (FTI), said the BoI guiding principle will attract auto manufacturers while the local auto parts industry and employment would expand.