Great Wall Motor Signs EV Price Subsidy Agreement With Thailand, Electric Cars Are Cheap

JAKARTA - Chinese carmaker Great Wall Motor has signed an agreement with the Thai government to cut the retail price of its electric vehicles. The statement came from company executives on Tuesday, March 22.

The move is said to be aimed at increasing domestic EV sales and production in Thailand.

According to Michael Chong, General Manager of Great Wall Motor Thailand, the agreement, which involves government subsidies and a reduction in value added tax, could save buyers up to 160,000 baht (Rp 68.5 million) per unit.

The agreement will apply to vehicles normally priced at 1 million baht, and represent a savings of around 13-15%.

"This is very beneficial for our customers ... because the price is more affordable," said Chong, at the 2022 Bangkok International Motor Show, as quoted by Reuters.

According to Thailand's Ministry of Finance, a similar agreement has also been signed with another competing automaker, SAIC-CP Motor, which is represented by the Thai unit SAIC Motor Corp.

The agreement comes as Thailand tries to encourage EV use and maintain its status as a major regional automaker in Southeast Asia. The Thai government is now targeting production of 725,000 EV units per year, or 30% of output by 2030.

Chong said other factors such as rising energy prices are also driving EV demand, which continues to grow significantly in many countries.

"Oil prices continue to rise, so people who buy ICE (internal combustible engine) will find it more expensive," said Chong. He also added that EVs will help to make the air cleaner. This is something Bangkok, the capital of Thailand, has been fighting for.

Great Wall Motor itself in 2020 took over the General Motors factory in Thailand, to become the fourth largest car assembly and export center in Asia.

So far, car manufacturing has accounted for about 10% of Thailand's gross domestic product and manufacturing employment.

According to Chong, Great Wall this year the company plans to sell 20,000 units in Thailand between its two brands, BEV Ora Good Cat and Haval SUV. They plan to produce EVs locally, in Thailand, by 2024.

But this transition will take time, with fewer than 4,000 electric vehicles registered in Thailand last year, and manufacturing investment still being made in conventional engines.

That includes US automaker Ford, which is investing US$900 million (Rp13 trillion) to upgrade its Thai factory to build its Ranger pickup truck and Everest SUV.

"ICE will be around for a while," said Andrea Cavallaro, Ford Director of Operations, International Market Group. He also added that EV technology and infrastructure has not been adopted throughout Southeast Asia.