BANGKOK, Thailand (AP) — Thailand will grant tax incentives to Suzuki Motor Corp. and Nissan Motor Co. for plants to produce small, fuel-efficient automobiles in Thailand, the country's deputy prime minister and industry minister said Friday.
Thailand, already a major pickup truck hub for Japanese automakers, is aiming to also become a manufacturing center for so-called eco-cars, and the Board of Investment has offered tax breaks to companies that will produce the vehicles.
The engine size of eco-cars must not exceed 1,300 cubic centimeters if they are gasoline-fueled and is limited to 1,400 cubic centimeters if they are diesel-powered. Also, they must not consume more than one 1 liter (1.06 quarts) of fuel for every 20 kilometers (12.4 miles) and create no more than 120 grams of carbon dioxide per kilometer.
Honda Motor Co. has already received tax incentives for its plan to build a 6.7 billion baht (US$222 million; euro152 million) eco-car production facility.
Suzuki Motor Corp. plans to invest 9.5 billion baht (US$282 million; euro193 million) in its project, while Nissan intends to invest 5.55 billion baht (US$184 million; euro125 million) through its local unit, Siam Nissan Automobile, said Minister Kosit Panpiemras.
Kosit said Suzuki plans to produce 138,000 eco-cars a year, 19 percent of which will be sold locally and the rest exported to other Asian countries, Australia and Africa. Suzuki's planned plant will start operations in 2010.
Meanwhile, Siam Nissan Automobile aims to have an annual production of 120,000 eco-cars, most of which will be exported to Asia and Australia, the investment board, or BOI, said in a statement. It didn't say when production will commence.
Kosit said the BOI, at its next meeting in late January, will consider eco-car project proposals from Mitsubishi Motors Corp., India's Tata Motors Ltd., Toyota Motor Corp. and Volkswagen AG.