Fol­low the EV Roadmap

For more than three years, Thai­land has looked to stim­u­late in­vest­ment in elec­tric ve­hi­cle (EV) pro­duc­tion.

Norway-Asia Business Review - - S NAPSHOTS - CHEYENNE HOLLIS

road­block in the form of scep­ti­cism from the car man­u­fac­tur­ers them­selves who want a clear govern­ment pol­icy, in­vest­ment cri­te­ria and in­cen­tives be­fore in­vest­ing fur­ther in EV pro­duc­tion.

Thai­land Fi­nance Min­is­ter, Mr Ut­tama Sa­vanayana, told lo­cal me­dia that the EV roadmap should build con­fi­dence and could be en­acted within the next three years. In Novem­ber of last year, the Thai­land Au­to­mo­tive In­sti­tute (TAI) called on the govern­ment to look at its own EV roadmap af­ter hear­ing car man­u­fac­tur­ers had seen lit­tle to con­vince them that EV adop­tion was fea­si­ble in Thai­land.

The TAI EV roadmap set a goal of pro­duc­ing 2.5 mil­lion cars in Thai­land by 2030 with 60 per­cent those be­ing sold do­mes­ti­cally. In or­der to reach these fig­ures, the TAI be­lieves a strong push from the govern­ment is re­quired that makes EVs more ap­peal­ing to both make and pur­chase in Thai­land.

“Thai­land aims to be a pro­duc­tion hub for EVs in the long term in or­der to main­tain the coun­try’s au­to­mo­tive com­pet­i­tive­ness in South­east Asia,” Mr Adisak Ro­hi­ta­sune, TAI Act­ing Pres­i­dent, told the Bangkok Post. “The govern­ment should em­pha­sise the EV in­dus­try with at­trac­tive priv­i­leges and in­cen­tives for both de­mand and sup­ply.”

On the road

En­tic­ing car man­u­fac­tur­ers to build more EVs is just one piece of the puz­zle. Those cars must be pur­chased and driven by the lo­cal pop­u­la­tion which has been slow to em­brace EVs be­cause of the cost. But things are slowly changing.

Prices for EVs are ex­pected to fall be­low THB1 mil­lion (USD32,000) as soon as 2020, ac­cord­ing to the Elec­tric Ve­hi­cle As­so­ci­a­tion of Thai­land (EVAT). Even with prices above the THB1 mil­lion, a shift is start­ing to oc­cur.

EVAT found that the num­ber of EVs, in­clud­ing hy­brid and plug-in hy­brids, reg­is­tered in Thai­land last year rose sig­nif­i­cantly. There are now 153,184 ve­hi­cles on the road, but less than 1000 were fully elec­tric. Data from the Thai­land Depart­ment of Land Trans­port showed that 25,180 EVs were reg­is­tered in Thai­land last year with 20,056 re­ceiv­ing pa­per­work in 2018.

For the sec­ond Jan­uary in a row, Bangkok was shrouded with dust and un­healthy PM2.5. The Thai govern­ment even went as far to mull ban­ning pri­vate cars, but noth­ing came of it. Instead, the Depart­ment of Land Trans­port un­veiled in­cen­tives to pro­mote the use of clean en­ergy ve­hi­cles in the coun­try.

This may help on a smaller scale, but it does all come back to the cost of EVs. This is why the govern­ment’s EV roadmap will seek to ad­dress is­sues from the con­sumer side as well.

“To en­cour­age con­sumers to shift to EVs on a broad scale, EV prices, which are more ex­pen­sive than fu­elpow­ered ve­hi­cles, must be ad­dressed in the master plan,” Mr Ut­tama stated. He added that the Hong Kong model of of­fer­ing dis­counts to con­sumers buy­ing EVs could be an ex­am­ple for the Thai govern­ment to con­sider.

Other mooted changes to pro­mote EV us­age in Thai­land pro­posed by EVAT in a 2019 re­port in­clude re­quest­ing the Air­ports of Thai­land Lim­ited and In­dus­trial Es­tate Author­ity to pur­chase EVs and set­ting aside of a por­tion of the govern­ment’s ve­hi­cle budget to go to­wards EVs. These could be in­cluded in the govern­ment’s roadmap in some form. Mr Ut­tama did not con­firm any specifics, only say­ing some parts of the plan had al­ready been drafted.

Power sup­ply

The EV roadmap will also need to ad­dress a third key area: in­fra­struc­ture. While charg­ing sta­tions and EV charg­ing lo­gis­tics are be­ing de­vel­oped, the govern­ment is keenly aware that a clear plan is needed to en­sure de­mand is met on this front. The BoI has stated that it ex­pects 7,000 EV charg­ing sta­tions to open dur­ing the next few years with an es­ti­mated 500 cur­rently in op­er­a­tion.

“There are many charg­ing mod­els in the world, such as those from Ja­pan, Ger­many and the US, but any model that is picked must meet Thai­land’s safety stan­dards, Mr Ut­tama noted. “The coun­try’s elec­tric­ity sup­ply must also be taken into con­sid­er­a­tion. Car mak­ers stand ready to in­vest in EV charg­ing sta­tions in Thai­land, but they want to know what kind of sup­port the govern­ment will of­fer.”

Bat­ter­ies also present a unique chal­lenge, but one the govern­ment has al­ready pre­pared for. The Ex­cise Depart­ment an­nounced that it will charge a fee for the track­ing of bat­tery de­mo­li­tion or re­cy­cling. The fee, which will be passed on to con­sumers, is set to take ef­fect in 2021 and will be re­funded af­ter the ve­hi­cle owner has re­turned the bat­ter­ies to a car dis­trib­u­tor.

Re­gard­less of the chal­lenges, some ex­perts think it is only a mat­ter of time be­fore Thai­land em­braces EVs.

“The tech­no­log­i­cal ad­vances in power stor­age to­gether with the ur­gent need to im­prove air qual­ity in the cities to com­pen­sate for the con­se­quences of ur­ban de­vel­op­ment will fuel the growth of EV’s pop­u­lar­ity tremen­dously,” Mr Paul Flipse, Head of Cli­mate Change and Sus­tain­abil­ity Ser­vices at KPMG Thai­land, said in a re­port. “It can be an­tic­i­pated that the mar­ket pen­e­tra­tion of EV in Thai so­ci­ety is un­de­ni­able and in­evitable. Auto in­dus­try and power in­dus­try have to re­assess their busi­ness model and pre­pare for the tech­no­log­i­cal and be­havioural changes.”

PHOTO: NORSK ELBILFOREN­ING/STÅLE FRYDENLUND

PHOTO: NORSK ELBILFOREN­ING

Above left: Nor­way is the world’s most suc­cess­ful coun­try in terms of elec­tric ve­hi­cle pen­e­tra­tion. 50% of all new cars are cur­rently EVs. Above: There are cur­rently 500 EV charg­ing sta­tions in Thai­land with the BOI pre­dict­ing some 7,000 will be online in the next few years. Above pic­ture from Nor­way.

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