The Thailand Board of Investment (BOI) has approved a package of incentives to promote investment in joint ventures (JV) between Thai and foreign companies to manufacture automotive parts and components, for vehicles using all types of propulsion systems.
The new package of incentives, which covers investments in both new projects and existing BOI-promoted projects, aims to provide increased business opportunities for Thai entrepreneurs operating in the sector and to help upgrade automotive parts production. The incentives will apply to the manufacturing of parts for internal combustion engines (ICE), hybrids, and electric vehicles.
Mr. Narit Therdsteerasukdi, Secretary General of the BOI, said these attractive incentives will incite foreign and local part makers to join hands to develop the industry and further strengthen Thailand’s position as an automotive industry manufacturing hub.
To qualify for the incentives, a new joint venture will be required to invest not less than 100 million baht in the manufacturing of auto parts and to be formed between a foreign company and a Thai company, whereby a Thai side must hold no less than 30% of the new entity’s registered capital. The Thai company entering the JV will itself be required to have been established for at least 3 years prior to application with the BOI, and to be at least 60% Thai-owned.
Both new projects and existing parts manufacturers already enjoying BOI promotion privileges but transforming into a JV along the same criteria will be eligible for 2 years of additional tax exemption on the condition their total tax exemption period does not exceed 8 years in total. Applications for investment promotion under this package must be submitted by end-2025. (NNT)
