Honing in on the EV industry goal Development of the electric vehicle industry is currently gaining a good deal of momentum, writes Yuthana Praiwan

Asia's Tech News Daily
Honing in on the EV industry goal  Development of the electric vehicle industry is currently gaining a good deal of momentum, writes Yuthana Praiwan

An electric boat developed by EA serves Bangkokians along the Chao Phraya river.

Development of the electric vehicle (EV) industry is gaining momentum as state and private sectors are working to translate plans to make Thailand a major EV production hub into actions.

The government, now working on a new excise tax to stimulate domestic demand for EVs and encourage more foreign investment in the industry, expects to finish the drafting within this year.

In the private sector, companies continue to announce plans to build EVs and their infrastructure while technology keeps developing which, together with the large-scale production of EVs, will eventually help reduce car prices.

Tax incentives are among measures set to be implemented to make Thailand a regional EV production hub, a significant shift from its decades-long manufacturing centre of cars based on internal combustion engines (ICEs), according to deputy Prime Minister and Energy Minister Supattanapong Punmeechaow.

EV manufacturing is expected to be one of the fast-growing industries post-pandemic.

The government is stepping up efforts to catch a new global trend in environmentally-friendly car production.

BIRTH OF EV INDUSTRY

To achieve the goal, authorities plan to boost both the demand and supply of EVs by dealing with concerns over car prices and charging facilities as well as ensuring a smooth transition to the new car industry.

Tax officials will be kept hectic this year as they devise ways to help promote EV sales.

Under the current excise tax structure, EVs are tax-exempt from Jan 1, 2020, to Dec 31, 2022, for car makers granted Board of Investment privileges, with the rates levied at 2% after 2022. Manufacturers that do not receive incentives are charged 8% tax.

New EVs should be more affordable and when they are sold as second-hand cars, their prices should not be very low, said Mr Supattanapong.

The National EV Policy Committee also plans to launch supportive non-tax measures, which include lowering the electricity tariff to reduce the cost of EV charging, increasing charging outlets, supporting battery production and relaxing some regulations to facilitate investment in the EV industry, said Mr Supattanapong, who chairs the committee.

To produce batteries and EVs, factory workers who are familiar with ICE-based vehicle systems will need to upskill to familiarise themselves with the new production technology.

Some manufacturers have already initiated a human resource development plan. In July, Energy Absolute Plc (EA), a renewable energy developer and operator, signed a memorandum of understanding with Rajamangala University of Technology Isan to produce university graduates with new tech skills to serve EA-run battery and electric vehicle (EV) production facilities in Chachoengsao.

The state and private sectors efforts to build the EV industry are taking shape, bringing Thailand closer to the goal of being an EV production hub.

Authorities initially set a target to have EVs make up 30% of total car manufacturing or around 750,000 of 2.5 million units by 2030.

However, the authorities decided to increase the target to 50% on March 24, following the rapid growth of EVs in many countries, especially in Europe.

Honing in on the EV industry goal  Development of the electric vehicle industry is currently gaining a good deal of momentum, writes Yuthana Praiwan

EV charging development is among EV-related businesses being promoted by PTT Group.

NET-ZERO CAMPAIGN

Developed countries led by those in the European Union, the US and Japan are expected to ban sales of new ICE-powered cars from 2030 or sooner as part of a “green revolution” to curb carbon dioxide emitted by cars under a net-zero goal, said Mr Supattanapong.

The concept of net-zero emissions, also known as carbon neutrality, is aimed at striking a balance between greenhouse gas emissions and absorption.

The EU wants to reduce greenhouse gas emissions to at least 55% below 1990 levels by 2030 and rely more on clean energy in order to cope with global warming.

The net-zero campaign not only accelerates EV infrastructure development, but also urges Thailand to use more renewable energy to produce electricity, said Mr Supattanapong.

Foreign investors in Thailand are expected to require more power supply based on clean energy to run their businesses as they join the net-zero goal.

Earlier this month, Prime Minister Prayut Chan-o-cha said Thailand is moving toward a low carbon economy with a goal of achieving carbon neutrality by 2065, according to government spokesman Thanakorn Wangboonkongchana.

The premier pledged to support the private sector’s transition to a low carbon economy and make sure that the shift is smooth and has minimal impact, said Mr Thanakorn.

Honing in on the EV industry goal  Development of the electric vehicle industry is currently gaining a good deal of momentum, writes Yuthana Praiwan

An electric bus developed by EA is part of its move toward EV assembly for mass transit.

TECHNOLOGY-DRIVEN INDUSTRY

Technology is also crucial to the steady growth of the EV market as it promises prospective buyers more convenient use of EVs, a key factor behind their purchasing decision.

Batteries, the main source of power for EVs, will be further developed to provide more electricity storage capacity, a longer cycle life and a shorter charging time, said Yossapong Laoonual, president for sustainability at King Mongkut’s University of Technology Thonburi.

The cycle life refers to the number of charge and discharge cycles that a battery can achieve before it is unusable.

Battery-powered EVs will become more attractive to drivers if the battery life lasts longer and, while being used, takes less time to charge.

EA invented “Parallel Charge,” an ultra-fast charging system that takes only 15 minutes to recharge batteries by up to 80%.

The equipment is being used to supply electricity to electric boats launched by the company as part of its plan to build mass transport vehicles, including buses and trucks.

The boats, which have commercially served Bangkokians along the Chao Phraya river since earlier this year, run on an 800 kilowatt-hour battery. A fully charged battery allows each vessel to make journeys covering up to 80 kilometres.

PTG Energy Plc, Thailand’s second largest oil retailer by sales volume, is also working with Electricity Generating Authority of Thailand to study and develop two types of fast charging facilities to serve large electric trucks.

The study focuses on locations for charging outlets and substations on the state power grid as the technology requires a high volume of electricity, according to PTG executive vice-president Rangsun Puangprang.

Mr Yossapong said tech development in the EV industry seems similar to mobile phone development 20 years ago. The phone transitioned from an analogue system to an advanced digital one and has become smarter by being programmed to take photos, access the internet and navigate journeys.

He expects the EV sector will grow significantly from 2025 to 2030.

“EVs will not only be a vehicle carrying people and goods, but it will become a computer with wheels,” said Mr Yossapong, who is also a former president of the Electric Vehicle Association of Thailand (EVAT).

He believes it is not too difficult for Thailand to become an EV production hub due to factors such as fundamental infrastructures, buyers with purchasing power and new EV development projects.

“EV-related activities have been very active in universities over the past few years. Most EV projects are initiated by universities,” he said. “Most Thai startups also work on EV projects.”

BRIGHT EXPORT PROSPECTS

The net-zero campaigns in many countries will help bolster EV exports while higher levels of EV production will reduce car prices.

Once Thailand achieves its goal to become a major EV production hub, it can take advantage of exporting EVs to countries where ICE-powered vehicles are banned, said Payouw Kummook, former deputy chief of the Office of Industrial Economics.

Australia, New Zealand and Japan will be key EV export destinations for Thailand at a time many Asian countries are not ready to fully enforce an EV policy, she said.

The private sector is currently developing EV production facilities and battery plants as they see new business opportunities in the new-generation car industry.

Auttapol Rerkpiboon, president and chief executive of national oil and gas conglomerate PTT Group, said PTT is allocating investment budget for key EV-related businesses, including EV assembly, battery production and charging equipment.

PTT has partnered with Foxconn, a Taiwanese electronics manufacturing giant, to conduct a feasibility study on EV manufacturing in Thailand.

PTT’s power generation arm, Global Power Synergy Plc, announced it would scale up its battery production capacity to a gigawatt-hour level after opening a factory in Rayong in July.

The 1.1-billion-baht factory, the first semi-solid battery production facility in Southeast Asia, currently has a capacity of 30-megawatt hours.

EA also opened a one gigawatt-hour lithium-ion battery production facility, worth 6 billion baht, in Chachoengsao in June. The firm began operations with a trial run of its machinery.

More battery and EV production will lead to economy of scale, which will eventually make EVs become less expensive, and able to compete with ICE-powered cars, said Mr Yossapong.

Echoing Mr Yossapong’s positive view, Ms Payouw believes the goal to become an EV production hub is possible.

The country’s auto ecosystem, with assembly facilities and a supply chain of vehicle parts, can pave the way for further economic development through EV manufacturing.

Thailand’s car industry, which employs 700,000 workers, makes up 6.4% of GDP, following the tourism, agriculture and food sectors, said Ms Payouw.

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