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THAILAND: Mazda mulls massive eco car investment

By Graeme Roberts | 11 November 2013

Mazda Motor Corporation is considering investing in the eco-car project phase two to increase its market share in Thailand.

Yuji Nakamine, a senior managing executive, told the Bangkok Post Mazda was discussing the conditions and rules for the phase, as the Thai government was expected to open applications for investment privileges soon.

The parent company was conducting a viability study of the eco car project because Mazda would also want to export some output.

The Board of Investment scheduled a submission deadline of next 31 March for interested investors to submit their eco car investment plans. To be eligible for privileges, companies must invest at least THB6.5bn to build a new plant with an annual production capacity of 100,000 eco cars within four years of operation.

Eligible cars for the second phase must emit less than 100g CO2/km.

The government will waive corporate taxes and import duties for machinery for the first eight years of operation.

Participating car makers will also enjoy excise taxes as low as 14%, while E85-compatible eco cars will be taxed at 12%.

Mazda operates a production plant in Rayong, a joint venture with Ford, called AutoAlliance (Thailand) or AAT.

AAT has annual production capacity of 140,000 one-tonne pickup trucks and 100,000 passenger cars.

Nakamine said half of the production from that plant is for two models: the 2 sedan and BT-50 pickup truck.

He said Mazda was keen to expand production capacity in Thailand given the development of its auto industry and its strong economic fundamentals.

Mazda cut its domestic sales projection this year to 1.2m vehicles from 1.3m as growth sagged.

It posted record vehicle sales last year of 1.45m due to the government's first time car buyer scheme.

Thai Mazda cut its sales outlook to 60,000 units, down from 80,000, the Bangkok Post said.

Last year, it sold 73,764 vehicles including the 2 and BT-50 which were eligible for the first car scheme.

Choichi Yuki, president of the Thai unit Mazda Sales Thailand expects local sales will be steady at 1.2m vehicles next year.

Mazda has introduced the CX- 5 in Thailand with target sales of 10,000 units annually. It is made in Malaysia.