ZOOMING ON HOME MARKET
Company eyes bigger share of SUV market
Nissan has localised the production of its hybrid models for the first time in Thailand with the new X-Trail Hybrid.
Japanese car maker Nissan Motor (Thailand) has localised the production of its hybrid models for the first time in Thailand, expecting to boost local demand with high-end vehicles.
President Kazutaka Nambu said the company started to produce its sportutility vehicle (SUV), the X-Trail Hybrid, last month at the plant on Bang Na-Trat Road in Samut Prakan with local content accounting for 70%.
Nissan’s facility in Thailand is the second site to make the X-Trail Hybrid, after Japan. Mr Nambu said the local plant was efficient enough to produce other Nissan hybrid models in the future.
The new X-Trail was initially available in Japan on May 13 and was then introduced at Gaikindo Indonesia International Auto Show on Aug 20.
It was kicked off yesterday in Thailand with prices ranging from 1.25 to 1.40 million baht for a two-litre engine, close to the prices for the X-Trail (non-hybrid), which range from 1.18 to 1.56 million baht for two-litre and 2.5-litre engines, which were introduced last November.
Senior vice-president Prapat Choeychom said the company aimed to make the retail prices of its hybrid models more competitive and attractive to customers, while increasing its market share of the SUV market with engines above two litres from 30% to 37% by 2016.
The segment sells about 20,000 units a year.
Mr Prapat said the company expected to sell 5,000 units of the X-Trail Hybrid in Thailand next year, representing about 60% of all Nissan X-Trail models sold in the country.
Hybrid vehicles in the Thai market remain very popular among high-end customers because they can afford the prices and prefer local-made models, saying the prices of imported hybrid vehicles are high at 3-5 million baht, he said.
However, the company has to increase the retail prices of X-Trail models by 5-10% due to a new tax regime, which will become effective next year.
From 2016 on, vehicles sold in Thailand will be subject to a new excise tax based on carbon dioxide (CO2) emissions, E85-gasohol compatibility and fuel efficiency rather than just engine size as before.
The excise tax on eco-cars with CO2 emissions below 100 grammes per kilometre will be cut to 12-14% from 17%, but the 10% rate for hybrid vehicles will remain.
Mr Prapat said the tax on the X-Trail Hybrid would increase from 10% to 20% next year because most engines sized more than two litres release more than 100g/ km of CO2.
Mr Nambu said although an electric vehicle could enjoy 10% tax under the new structure, the Yokohama-based parent firm has no plans to localise production because local sales are relatively small and the plant has to rely on imported parts.
Nissan expects to sell 50,000 units in the market this fiscal year, ending next March, down by 11.7%.