Thailand Excise to submit May car trade-in plan for older cars

Thailand is drafting an old-car-for-new-car scheme, with the Excise Department preparing details and a conceptual framework for submission to Finance Minister Ekniti Nitithanprapas in May.

The aim is to determine who will qualify for the scheme and how the benefits will be granted.

Pornchai Thiraveja, director-general of the Excise Department, said the working group was gathering details and studying the criteria, and was expected to conclude the conceptual framework and suitable options for submission to Ekniti by mid-May.

The study was assigned after oil prices surged because of the war in the Middle East, with the government hoping to encourage motorists to switch to energy-saving vehicles such as electric vehicles and hybrids, reduce CO2 and PM2.5 emissions, and stimulate vehicle sales.

Pornchai said the scheme was also intended to support a transition away from oil-powered cars to environmentally friendly vehicles.

Pornchai said: “The Excise Department is expediting work in line with government policy and the Finance Ministry’s instructions. We already have an existing database, which allows us to build on it and finalise the plan immediately in accordance with the process and procedures.”

In drawing up the scheme, the department is weighing four main factors: carmakers’ production capacity in Thailand, the number of vehicles to be included in the programme, how old vehicles traded in under the scheme would be dealt with in a way that is environmentally sound and economically worthwhile, and what types of new vehicles should qualify.

The department said it still had to analyse all surrounding factors and hold talks with operators and car companies about how much production capacity they could support, particularly in areas where manufacturers had already proceeded to some extent.

It also has to assess how many old vehicles in the system are likely to meet the conditions so that an appropriate number of cars can be set for the programme.

At the same time, officials have to consider competitive fairness, including appropriate pricing or battery-size conditions, so that no operator gains an unfair advantage or disadvantage.

Battery size and the price of the new vehicle eligible for support will directly affect the amount of state funding required.

Although one proposal suggests that vehicles must be at least 10 years old to qualify, no conclusion has yet been reached, and further study is needed on whether the age threshold should be adjusted.

Such vehicles have been identified as a high-emissions group.

On the new-car side, the scheme would not be limited to 100% electric vehicles.

It could also include other electrified vehicles, such as hybrids, to support the transition to modern automotive technology.

Another key issue is what to do with the old vehicles brought into the programme, in order to ensure a genuine transition and address vehicle scrapping in a systematic way.

A Finance Ministry source said the Excise Department was comparing the proposed scheme with the previous first-car scheme and EV support measures to reduce complexity and make the process as convenient as possible for the public.

The source said any measure adopted would have to benefit all car brands.

It would therefore need to apply to all types of energy-efficient vehicles, including battery electric vehicles, plug-in hybrid electric vehicles, hybrid electric vehicles and fuel-cell electric vehicles, in line with the Cabinet resolution allowing the Government Savings Bank to provide loans for EV purchases.

The same source said the department was still waiting for policy clarity on what should happen to old vehicles after they were exchanged.

If the objective was to push cleaner, energy-saving vehicles and reduce environmental impact, the old vehicles should be destroyed.

However, the Excise Department is not responsible for scrapping old vehicles and would therefore need to work with other state agencies.

Uncertainty surrounding the measure has already begun to affect the domestic car market.

Some consumers have delayed purchase decisions or postponed taking delivery of vehicles they have already booked while waiting for clarity on the benefits, especially amid expectations that state support could amount to hundreds of thousands of baht per vehicle.

In some cases, customers have already booked cars and completed finance approval, but have decided to delay taking delivery in the hope that the new government measure will provide substantial support per car.

A dealer source told Thansettakij that, from another perspective, the old-car-for-new-car measure could encourage people who were not financially ready to take on more debt, even though household debt was already high.

The source said the market was slowing while buyers waited for an official announcement.

Some customers who booked cars at the Bangkok Motor Show 2026 and had already passed finance approval had still asked to postpone taking delivery.

The source said: “Earlier reports that the government would provide support of hundreds of thousands of baht per vehicle under the old-car-for-new-car scheme have led some customers to postpone taking delivery for the time being.”

An executive at a Japanese carmaker said that, of the more than 130,000 bookings recorded at the Bangkok Motor Show, 70-80% were EVs. That meant that if market forces were left to operate on their own during a period of high oil prices, consumers would already be moving increasingly towards EVs without the need for a measure that distorted the market.

The executive said: “What matters is how old a vehicle must be to qualify for the programme, because some models that are more than 10 years old still have market value today. The question is whether the subsidy will be attractive enough to persuade owners to switch vehicles, and whether that group will be able to meet instalment payments or pass finance approval.”

Besides the lack of clarity over the measure, which is affecting the car market in April and May, Japanese carmakers have also been watching the government’s move to include EVs in the programme.

Over the past two to three years, Japanese car companies have repeatedly called on the government to introduce broader support for the automotive industry, as falling production and sales have hit the supply chain and affected more than 800,000 jobs, including suppliers and related businesses.

Toyota Motor Thailand Co., Ltd. had previously proposed that the government adopt medium- and long-term plans to support vehicle segments that contribute to the country’s economic development, such as pickup trucks, along with short-term measures to stimulate the industry during a difficult economic period.

One of those proposals was an old-car-for-new-car scheme.

That means the idea of an old-car-for-new-car measure has been discussed continuously between the public and private sectors, led by Thailand’s automotive industry.

However, it was not originally focused on EVs, because EV 3.0 and EV 3.5 had already provided substantial benefits to that segment.

In 2025, when Pichai Chunhavajira was the finance minister, there was also an idea for an old-car-for-new-car measure, but it focused on pickup trucks aged 20 to 25 years.

The aim was to stimulate weak pickup sales and address PM2.5, but the measure was ultimately not implemented.

Pornchai said: “The department will have to step up discussions with the relevant associations and operators to reach clear conclusions on the various conditions. If there is any progress on the budget to be used, which will depend on the number of vehicles joining the scheme, the department will report it in due course.”

Against that backdrop, motorists planning to replace older vehicles are closely watching developments ahead of the expected mid-May proposal, amid hopes that, if the measure is approved, trading in an older vehicle for a more energy-efficient new one could bring discounts or other benefits.