South Korea-based Hyundai Mobility Manufacturing (Thailand) plans to make battery electric vehicles (BEVs) and batteries in Thailand by 2026 after its 1-billion-baht project was approved by the Board of Investment (BOI).
The plan was announced by the board after granting approval for the project yesterday under the second-phase electric vehicle (EV) incentive package, known as EV3.5.
The government provides incentives to manufacturers as well as subsidies to consumers purchasing EVs.
EV3.5, which aims to propel EV industry growth between 2024 and 2027, comprises subsidies, reduced import duties for fully assembled cars and an excise tax cut.
EV manufacturers joining EV3.5 are required to produce EVs domestically from 2026.
"Hyundai's entry in Thailand's EV sector is a very positive development, confirming the attractiveness of Thailand as both a manufacturing base and an important market," said Narit Therdsteerasukdi, secretary-general of the BOI.
Hyundai's factory is set to be located in Samut Prakan near Bangkok.
Hyundai's assembly plant will be jointly operated by Thonburi Automotive Assembly Plant Co, which is the company's strategic business partner.
"Thailand's strong existing supply chain will allow Hyundai to source not less than a third of the raw materials and parts it needs from within Thailand, thus supporting the local industry," said Mr Narit.
Hyundai is one of many foreign EV manufacturers encouraged to help build the EV industry in Thailand.
Under the 30@30 policy, Thailand expects EVs to represent at least 30% of total motor vehicle production in the country by 2030 through the production of 725,000 zero-emission cars, 675,000 electric motorcycles and 34,000 electric buses and trucks.
So far, 18 manufacturers, hailing from China, Japan and Europe, have either started producing EVs in Thailand or announced they will begin manufacturing over the next two years.
The BoI has already approved projects with a total investment value of over 80 billion baht in the EV supply chain.
According to the Global EV Outlook 2024, published by the International Energy Agency, in the first quarter of 2024, electric car sales around the world grew by around 25%, compared with last year's first quarter.
EV sales could reach around 17 million in 2024, accounting for more than one in five cars sold worldwide.