The Thai government launched a new vehicle market stimulus programme at the end of last week targeting first-time buyers of cars costing up to THB1m.

The excise department hosted a special event at the Bi-Tec exhibition centre in Bangkok to promote the scheme, with the support of 11 local automakers and a large number of finance companies.

The event was dampened by a rising flood crisis across the northern and central regions, however, which has brought to a halt most of the country’s vehicle production operations over the last week.

The government nonetheless is confident that the scheme will ultimately attract at around 500,000 new car buyers, with the total tax discount expected to amount to THB30bn over the duration of the programme.

Under the programme, first-time car buyers over the next 12 months will qualify for an excise tax rebate worth up to THB 100,000 if ownership of the car remains unchanged for five years. 

The government is still considering whether to reduce the ownership period and also whether to lift the 1,500cc maximum engine size and include imported vehicles into the programme.

The incentive programme mainly targets the expanding range of small cars produced locally under the government’s Eco-Car programme. Nissan was the first to Thai Eco-Car market with the launch of the March [Micra] last year, followed by Honda with the Brio earlier this year.

Mitsubishi Motors is expanding its dealer network in anticipation of the launch of its Eco-Car early next year. Other manufacturers, including Toyota, Suzuki and Volkswagen, are set to follow.