BMW Group Thailand plans to increase prices for all models by 1.5% from Wednesday because of a surge in energy costs and inflation, as well as a shortage of some auto parts.
The increase comes as the global automotive industry struggles to deal with the impact of the semiconductor shortage and the Russia-Ukraine war, said Alexander Baraka, chief executive of BMW Group Thailand.
The war exacerbated the prolonged chip scarcity as the two countries are major exporters of neon gas, a key material in chipmaking, according to the Federation of Thai Industries (FTI).
“We have tried to cooperate with our suppliers on finding ways to reduce costs, but it is not easy,” said Mr Baraka.
The company believes its new price tags will not affect sales in the premium car segment. Higher prices should not cause customers to delay making purchases.
Mr Baraka said Thailand’s premium car segment will keep growing, thanks to the recovery of the domestic economy, following growing tourism and the full reopening of the country.
The FTI expects car prices to rise by 5-10% in 2023, mainly because of the impact of the global semiconductor shortage.
The new prices will apply to both domestic and overseas markets, given the higher costs of raw materials, the group said earlier.
BMW Group Thailand is confident about the growth of the local electric vehicle (EV) market, following the launch of tax cuts and subsidies to promote EV production and consumption.
Last year, the company saw its share of the premium battery EV market stand at 40.8%, with 535 vehicle registrations, a fivefold increase from 2022.
BMW Group Thailand is also working with partners to proactively expand the public charging network, making 900 EV chargers available for BMW and Mini customers nationwide.
Mr Baraka said the company currently has no plan to build an EV assembly factory in Thailand, but it is in talks with the government regarding EV investment.
In 2022, BMW Group Thailand recorded a stable performance with 15,010 BMW and Mini registrations, a year-on-year increase of 36.1%.
BMW Motorrad Thailand maintained its performance in 2022, with 1,293 motorcycle registrations.
Both BMW and Mini brands commanded a 46.6% share in the premium automotive market last year.
