Nex Point: Weak growth aids sales

The projection of slow economic growth in Thailand this year is believed to be good for electric vehicle sales, says Nex Point Plc, a local assembler of commercial EVs.

The National Economic and Social Development Council recently downgraded its GDP growth outlooks for 2023 and 2024 to 1.9% and 2.7% respectively and suggested the Bank of Thailand help to propel the economy by considering cutting interest rates to reduce the burden on small and medium-sized enterprises and households.

This forecast will cause businesses to become more cautious about expenses, including energy costs, said Khanist Srivajiraprabha, founder and chief executive of Nex Point.

“This sentiment can prod entrepreneurs, especially logistics operators, to start thinking of a plan to replace oilpowered vehicles with those run using batteries to save on expenses in the long term,” he said.

Though commercial EVs are more expensive than vehicles that use internal combustion engines (ICE), the break-even period for commercial EVs compared with ICE vehicles is three years, said Mr Khanist.

Nex Point set a revenue target of 20 billion baht in 2024, a sharp increase from 9.4 billion last year. The company expects to sell 5,556 vehicles this year, driven by a backlog of purchase orders for 2,757 vehicles.

He said the state policy to fuel the growth of the domestic EV industry should also drive sales of EVs.

‘‘ This dim forecast will cause firms to become more cautious about expenses, including energy costs. KHANIST SRIVAJIRAPRABHA Chief executive, Nex Point

The National Electric Vehicle Policy Committee last week approved a new incentive package to motivate companies to transition their commercial fleets of large trucks and buses to battery BEVs. Authorities are granting a tax deduction to eligible companies, effective until Dec 31, 2025.

Mr Khanist said Nex Point’s positive sales outlook is also based on plans to export to Vietnam, Malaysia, Indonesia and the Philippines. Supply should serve demand in the public transport and logistics sectors in these countries, he said.

Nex Point is assembling buses, pickups and tractor heads at its factory in Chachoengsao’s Ban Pho district. The annual production capacity of these three types of vehicles are 9,000, 20,000 and 30,000 units, respectively.