Cheaper fuel cost drives Thailand’s higher EV adoption in 2023

Thailand’s total registration of electric vehicles (EVs) in 2023 crossed 75,000 vehicles, increasing 690% compared with EV registration in the previous year, ttb analytics, a research centre of TMBThanachart Bank, reported on Saturday.

The centre said that EV registration in 2023 was accountable for 11.6% of total registration of passenger cars on Thai streets. This ratio has expanded to 18.4% in the first quarter of 2024, signifying the continued growth of consumer adoption for electric automobiles.

Ttb analytics said the main factor that has driven EV adoption at unprecedented rate is the cheaper fuel cost of EVs, which is about 59% to 67% lower than that of vehicles with internal combustion (ICE) or hybrid engines.

The centre said that the average EV marketed in Thailand will cost users 0.72 to 0.95 baht per kilometre in charging fee, while average ICE or hybrid vehicles have a fuel cost of 1.82 to 2.72 baht/km.

Ttb analytics warned, however, that electricity cost in the future could go up depending on the fuel tariff (FT) adjustment, which reflects the cost of fossil fuels used to produce electricity.

The centre added that EVs could also have higher variable costs compared with ICE counterparts, since EVs are generally heavier by 18.9% to 36.1%, which means they will require larger, more expensive tyres. EV tyres will also undergo faster wear due to the engine’s higher instant torque, it said.

Regarding other expenses besides parts or fuels, ttb analytics said EV users will be at a disadvantage in terms of insurance premiums, which are about 30% higher than for ICE vehicles. However, this expense could be offset by lower annual taxes for EVs, which are currently at 330-380 baht for D-segment vehicles. 

Meanwhile, ICE vehicles of comparable engine, or 2,487cc, will have to pay annual vehicle tax of up to 4,848 baht, the centre said.

Ttb analytics advised prospective EV buyers to consider the fixed and variable costs, as well as other associated expenses before making the purchase or switch from ICE vehicles. Another factor that needs to be carefully considered is the availability of charging stations near the user's home and workplace, it added.