FTI refutes speculation of price war between EV and ICE automakers
Promotions on several models of electric vehicles, ICE and hybrid cars a sales tool not a price war, Federation says
The recent price slashing of both electric vehicles (EVs) and internal combustion engine (ICE) vehicles have sparked speculation that a new round of price wars is about to erupt.
The speculation, however, has been dismissed by the Federation of Thai Industries (FTI), who said that the move is just a marketing technique and a normal phenomenon in the highly competitive automotive market.
Rêver Automotive, the authorised dealer of Chinese EV under BYD brand in Thailand, has cut the prices of several models up to 160,000 baht, including the new 2024 BYD Dolphin. The promotion however only lasts until the end of this month.
Meanwhile, Japanese automakers Mazda and Nissan this month launched campaigns offering discounts from 100,000 to 140,000 baht on their ICE and hybrid vehicles.
Surapong Paisitpatanapong, deputy chairman and spokesperson for the FTI’s Automotive Industry Group, said on Thursday that the current situation is not considered a price war, but merely the use of a marketing technique amid increasing competition.
“Only selected models of ICE vehicles and EVs are discounted, and only for a limited time. This is a marketing campaign for the auto market, which has been highly competitive even before the arrival of EVs,” he said.
“Automakers want to increase sales to maximise their production, thus decrease the cost per unit, under the principle of economy of scale,” said Surapong. “Furthermore, new models are usually cheaper due to having smaller engines, in line with the carbon reduction trend.”
Krisda Uttamot, president of the Thai Electric Vehicle Association (EVAT), said the recent price slash by BYD was enabled by the automaker’s distinct advantage of having its own battery manufacturing facility, which can help greatly reduce the cost of EVs.
He added that another reason for price cuts could be the need to manage the company’s stock of vehicles to be in line with the sales and future production plan.
“Cutting prices is not something every brand wants to see, and no one can keep reducing their prices forever, as it would impact the entire market, including the used car segment,” he said. “Furthermore, price cutting could affect consumer’s confidence in the brand and hesitation to make a purchase, due to fear that prices will drop further.”
