The global campaign against carbon dioxide emissions is not only benefiting electric vehicle sales in Thailand, but also fuelling EV growth in Southeast Asia.
Nex Point Plc, a local assembler of commercial EVs, plans to take advantage of this trend by exporting its vehicles abroad after securing its position in the domestic market.
The manufacturer of electric buses, pickups and tractor heads wants to prove businesses linked to environmental issues can offer a promising source of revenue, said Khanist Srivajiraprabha, chief executive and founder of Nex Point.
OVERSEAS EXPANSION
The company is preparing to sell its commercial EVs across Asean, part of efforts to make itself a key EV assembler in the region.
“This year will be the first where we tap into rising demand for clean transport by selling commercial EVs in the region, utilising the Asean Free Trade Area [Afta]," he said.
Established in 1992, Afta aims to eliminate tariff barriers among Asean countries to integrate the bloc's economies into a single production base, according to the Asean Secretariat.
Nex Point is eager to enter the EV market in Indonesia, which is rich in nickel, a key raw material for making EV batteries. The company also wants to sell its products in Vietnam, where the EV industry has high potential to grow, said Mr Khanist.
"We are conducting a test run for our commercial EVs to ensure they meet the standards and regulations required by countries in Asean," he said.
"Meeting these requirements means we can stand at the front door of buyers."
Nex Point set a target to export roughly 400 vehicles to Indonesia and Vietnam this year.
GREAT EXPECTATIONS
According to Mr Khanist, countries in Asean understand the need for zero-emission cars to deal with climate change because entrepreneurs cannot be expected to run campaigns against global warming voluntarily.
Certain businesses are required to adopt eco-friendly technology as part of their operations, he said.
This effort stems in part from regulations launched by the European Union to control carbon dioxide emissions from manufacturers.
The EU is implementing the carbon border adjustment mechanism (CBAM) in the transitional phase to reduce carbon-intensive manufacturing of imports.
CBAM covers iron and steel, aluminium, cement, fertiliser, electricity and hydrogen businesses.
Importers are scheduled to pay a levy for CBAM certificates from Jan 1, 2026.
In Thailand, many companies are turning to EVs. Siam Cement Group uses electric trucks at limestone mines, operated by subsidiary Siam Cement (Thung Song) Co. The EVs help reduce both carbon dioxide emissions and PM2.5 ultra-fine dust.
The Thai government is fuelling the growth of the EV market, hoping to make the country a regional hub of EV production.
Last year, new registrations of electric trucks skyrocketed 2,967% to 276 units, up from only nine in 2022, according to the Department of Land Transport.
Newly registered battery-run buses tallied 1,218, a year-on-year increase of 24.8% from 976 units.
New registration of all types of battery EVs (BEVs) soared by 382% to 100,214 units, up from 20,801 units in 2022.
GEARED TO EVS
The growing number of BEVs in Thailand proves Nex Point made the right decision to transform its business, which was originally established as an electronic parts company, said Mr Khanist.
Nex Point supplied buses fuelled by compressed natural gas and diesel before transforming to manufacturing of commercial cars powered by electricity.
The company made the switch before the Prayut Chan-o-cha government announced a plan to support EVs as one of the country's targeted S-curve industries.
“We decided to assemble commercial EVs because this segment is a blue ocean market, unlike electric passenger cars, which are a red ocean market," he said.
Under the state EV roadmap from 2022 to 2030, authorities aim to have BEVs comprise 30% of total vehicle manufacturing by 2030, with production of 725,000 zero-emission cars, 675,000 electric motorcycles and 34,000 electric buses and trucks.
Nex Point's factory in Chachoengsao valued at 2 billion baht is designed to produce 9,000 electric buses, 20,000 tractor heads and 30,000 pickups annually.
The plant is operated by Absolute Assembly Co, a joint venture 45% owned by Nex Point, with 55% of investment from Energy Absolute Plc, a renewable energy and EV developer and operator.
According to Mr Khanist, many companies, especially in public transport, decided to shift to commercial EVs because they want to avoid fuel price fluctuations related to the impact of the Russia-Ukraine war.
BACKLOG
Nex Point set a revenue target of 20 billion baht in 2024, a sharp increase from 9.4 billion last year.
The company expects to sell 5,556 vehicles this year, driven by a backlog of purchase orders for 2,757 vehicles.
Sales of commercial EVs are expected to grow after the National Electric Vehicle Policy Committee resolved in February to approve incentives for companies to transition their commercial fleets of large trucks and buses to BEVs.
The incentives include a tax deduction granted to eligible companies, effective until Dec 31, 2025.