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Revealing Four Conditions: Enterprises That Meet These Criteria Will Receive BOI Support for Electric Vehicle Battery Production Investment

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As anticipated, the Board of Investment (BOI) has approved investment promotion measures for EV battery manufacturing after holding a roadshow meeting with top battery manufacturing executives from China in April. The goal is to establish Thailand as a key production base for EV batteries, a capital-intensive, high-tech industry. The approved measures come with specific conditions as outlined below:

Key Conditions for Investment Promotion

1. Must Be a Leading Battery Manufacturer for EVs
The companies producing EV batteries must have their batteries used by electric vehicle manufacturers. Currently, several companies fit this criterion, including:
  • Chinese manufacturers: BYD, EVE, CATL, CALB, SVOLT, Gotion, Sunwoda
  • Korean manufacturers: LG, SK
  • Japanese manufacturers: Panasonic
These companies are expected to be the major investors looking to establish EV battery production bases in Thailand’s industrial parks.

2. Must Have Plans to Produce Battery Cells for EVs
Investors must have plans to produce battery cells for electric vehicles, with the capability to produce cells for energy storage systems (ESS) as well.

3. Minimum Energy Density Requirement
The produced battery cells must have a minimum specific energy density of 150 Wh/Kg.

4. Minimum Charge Cycle Requirement
The battery cells must have a minimum life cycle of 1,000 charge cycles.

Benefits for Investors from BOI

For  investors that meet all four conditions and wish to invest in Thailand's industrial parks while seeking BOI promotion, the following incentives are available:

1. Battery Manufacturing with Cell Production (Group A1)
  • Corporate income tax exemption for 8 years, with no cap.
  • Exemption from import duties on machinery, materials for research and development, and raw materials for export production.
  • Additional non-tax benefits
  • 90% import duty reduction for raw materials not available domestically (Section 30) for 2 years.
2. Battery Manufacturing with Module Production (Group A2)
  • Corporate income tax exemption for 8 years.
  • 90% import duty reduction for raw materials not available domestically (Section 30) for 2 years.
3. Battery Manufacturing with Pack Assembly Only (Group A3)
  • Corporate income tax exemption for 5 years.
Additionally, investors will receive subsidies for battery production and usage in Giga Factories within Thailand (demand-linked), at a rate of 20 USD/kWh (600 THB/kWh), along with investment subsidies on a case-by-case basis (CAPEX subsidies).

There are also additional benefits under Thailand’s competitiveness enhancement laws for targeted industries,
including:
  • Corporate income tax exemption for up to 15 years.
  • Exemption from dividend taxes.
  • Exemption from import duties on machinery.
  • Exemption from import duties on raw materials used for export production, and up to a 90% import duty reduction for raw materials used in domestic production.
  • Exemption from import duties on items used for research and development.
304 Industrial Park is one of Thailand’s leading industrial land developers, recognized and promoted by the BOI (Board of Investment). The park is a hub for various industries, including automotive parts and electronics manufacturing. With comprehensive infrastructure and utilities, it is well-prepared to support high-quality production and investment from major global players.

Information Source:
  • https://www.prachachat.net/economy/news-1506935
  • https://www.boi.go.th/index.phppage=press_releases_detail&topic_id=135055&_module=news&from_page=press_releases2
  • https://www.thansettakij.com/business/economy/595260
  • https://www.salika.co/2024/04/07/competition-of-ev-battery-industry/