Latest news from Europe says that the Volkswagen Group is looking to set up its first car plant in Thailand to help narrow the gap with Toyota Motor Corp. in Southeast Asia. VW is seeking to participate in a government program offering tax exemptions for automakers investing at least 6.5 billion baht (USD200 million) in local manufacturing. Annual production must reach at least 100,000 cars in the fourth year after starting operations, and manufacturing must begin by 2019, in order to receive the incentives.
The program from Thailand’s Ministry of Industry includes vehicle assembly, components and engine production. Carmakers had until March 31 to apply, according to a ministry statement from October 2013. Volkswagen anticipates industry wide regional sales will increase on average 4.5 percent annually through 2018 in the region comprising Indonesia, Thailand, Malaysia, Philippines and some smaller neighboring countries.
VW’s new subsidiary Ducati produces motorcycles in Amata City, Thailand. VW has also started assembling the VW Passat, VW Polo sedans and also most recently the VW Polo hatchback 1.6 in Malaysia with Malaysian motoring giant DRB-Hicom Bhd.
VW CEO Martin Winterkorn said last month that the VW Group is looking to sell more than 10 million vehicles worldwide in 2014, four years earlier than initially planned, as VW seeks to overtake Toyota as the industry leader by 2018.
