FTI says gov promotion of E85 car muddies investment waters

BANGKOK, Aug 2 (TNA) - Automobile manufacturers in Thailand may move theirproduction bases elsewhere because the campaigns being launched by the government promoting the production of E85 cars, aimed at saving energy, while still unclear, compete with government promotion of the automotive sector in other ways, according to a senior Federation of Thai Industries (FTI) official.

Piangjai Kaewsuwan, chairwoman of the FTI Automotive Industry Group, said the Thai government position regarding energy saving campaigns promoting the use of E85 cars is still not clear and it could pose obstacles to future production and investment for automotive industry producers in the country.

Plans to manufacture cars need considerable preparation time, Mrs.
Piangjai said.

The government has decided to reduce the excise tax for E85 car to 20 per
cent which is close to the 17 per cent imposed on eco-cars, which will
affect the production and sales strategies of manufacturers in Thailand
and only E85 cars will need to be imported into the country.

"Presently, investors plan to produce 680,000 eco-car units annually in
Thailand. Some of them are now thinking of moving their production bases
to other countries already because of the uncertain policy of the
government," she said.

If the government wants to promote E85 car production, Mrs. Piangjai said,
it should map out a clear policy and allows producers to develop cars at
lease three to four years and not try to solve immediate problems like it
is doing now.

And before promoting the production of E85 cars, the government should
encourage the production of E10 and E20 cars first, she added.

The government is now going all out to encourage more motorists to switch
to using E85, a blend of 85 per cent ethanol and 15 per cent gasoline.
(TNA)