Thailand adjusts EV policy to head off supply glut

PUBLISHED : 25 Nov 2025 at 17:36

WRITER: Reuters and Online Reporters

Thailand has made changes to its electric vehicle incentive policy in order to encourage exports and head off a supply glut at home, which could have an impact on the overall car market, the Board of Investment said on Tuesday.

Every EV produced for export will now count as 1.5 units towards a manufacturer’s local production obligations, the agency said in a statement.

“This is to incentivise automakers to increase exports and prevent domestic market oversupply,” it said.

In July, the agency revised its EV policy to give carmakers more flexibility to meet production requirements and boost exports.

Chinese brands dominate the EV segment in Thailand, with a combined share of over 70% of sales.

Under the government’s incentive programme known as EV3.5, running from 2024 to 2027, EV manufacturers are granted tax cuts and subsidies to import vehicles for sale in Thailand in exchange for their investment in EV assembly plants here.

The programme has drawn more than $4 billion worth of investments, including from major Chinese manufacturers BYD and Great Wall Motors.

New battery EV registrations in Thailand from January through July rose by 35% year-on-year to 81,179 units, according to the Federation of Thai Industries.

Battery EVs accounted for 18% of total domestic car sales in the same period, compared with 24% for diesel and petrol-fuelled pickups, 23% for internal combustion engine passenger cars and 20% for hybrid EVs.