Report – Thailand to approve Volkswagen factory image

According to a German newspaper’s report, Thailand is set to give the green light to the construction of a Volkswagen plant near the port of Bangkok.

Frankfurter Allgemeine Zeitung cited the Thai investment authority – BOI – reporting that the investment which is under Thailand’s Eco2 program, would secure tax and customs advantages for Volkswagen if it builds fuel efficient cars. The plant though needs to build more than 100,000 vehicles and to start production by 2019.

The paper said that a decision from the authority could come as soon as the following week and cited senior BOI officials stating that Volkswagen plans to export the cars produced in Thailand. A Volkswagen spokesman declined to comment, while VW’s CEO, Martin Winterkorn, has said that the company needed to expand its presence in Southeast Asia if it wants to achieve its goal of taking Toyota’s number one spot as the global market leader.

Japanese automakers together represented 88% of the region’s auto market in 2013. According to data from industry researcher LMC Automotive, Toyota led the Thai market last year delivering 30% of the 725,135 vehicles sold there. Volkswagen is getting into the region as part of a larger plan to take the top spot in global sales by 2018 from Toyota.

By Gabriela Florea