BMW Group Manufacturing Thailand, a local arm of the German luxury carmaker, has set aside 400 million baht to prepare its production facility for this year's electric vehicle (EV) plan.
Managing director and chief executive Jeffrey Gaudiano said the facility will span an additional 5,000 square metres from the existing building area of 45,000 sq m at its plant in Amata City Industrial Estate in Rayong.
This move is aimed at facilitating BMW's electrification plan for plug-in hybrid vehicles (PHEVs), for which the group has applied for Board of Investment (BoI) privileges.
The German firm plans to localise assembly of PHEV batteries at its Rayong plant in 2019.
"We have to prepare in advance for both vehicle and battery assembly lines to seek more suppliers and purchase new tools under the EV platform, as we can move more slowly than others," Mr Gaudiano said. "BMW is in the process of concluding talks on this project with government agencies, including the BoI."
BMW Group is the second European carmaker that has moved to capitalise on the government's EV scheme, with German peer Mercedes-Benz ready to lay the cornerstone for its new manufacturing facility for plug-in hybrid electric vehicle (PHEV) batteries on March 14.
Munich-based BMW Group recorded successful PHEV sales in the Thai market in 2017, rising by 269% year-on-year.
In 2017, PHEVs represented 13% of the 10,020 BMW cars in the country, ranking third after Malaysia (56%) and Scandinavia (27%).
Stefan Teuchert, president of BMW Group Thailand, said BMW aims for PHEVs to account for 20-25% of its sales this year.
"We believe in the future electrification trend in the Thai automotive market, but it is not easy to make EVs locally when the market is still small and local motorists have limited experience with new generation vehicles," Mr Teuchert said. "An important thing is to import and introduce innovative EV cars to give motorists the necessary experience, helping grow the market."
At present, BMW assembles four PHEVs at the Rayong plant -- 330e, 530e, X5 xDrive40e and 740Le -- all serving the domestic market. But the vital batteries are still imported from Europe.
The company also imports BMW i8, a plug-in hybrid sports car to be sold in Thai market.
In a related development, BMW Tuesday achieved the 100,000-unit benchmark at its Rayong plant. Of those, 90,000 units were cars and the others were from its big bike unit, BMW Motorrad.
A 530e was the 100,000th vehicle to be produced.
The 4.7-billion-baht investment at the company's Rayong plant was made during 2000-17.
The company produced 20,002 BMW cars alone in 2017, 60% of which were exported to China.
BMW Motorrad is also assembled at the same plant, with 2,209 motorcycles made in 2017.
For three of the models produced -- R 1200 GS, F700 GS and F 800 GS -- half are shipped to China, Malaysia, the Philippines and Vietnam.
BMW had 11,030 BMW and Mini vehicles delivered to customers from in 2017, an increase of 39%.
BMW Motorrad registered its sixth straight year of double-digit growth, with 2,001 motorcycles delivered in 2017, up 10% from the previous year.