PTT have a new category of fuel listed: E85. The new 85% ethanol 15% petrol blend will be THB 20.19 per litre as of tomorrow (29-Aug-2008). This makes the new fuel THB 7.20 cheaper than E20.
The big question is where are the cars? Despite the eagerness to produce and supply E85, flex-fuel vehicles are still not here. The Thai government are currently working on ways to entice automakers into bringing vehicles with E85 technology to Thailand.
Volvo has expressed a desire to take part in the Thai Government's E20 campaign, which effectively allows for a 5% price drop on cars compatible with the E20 fuel specification. This has already resulted in large price drops on Honda, Ford, Nissan, Mazda and Mitsubishi cars.
If Volvo were to benefit from the tax reduction, it could see prices of some models fall by as much as THB 200,000 - THB 300,000, which would improve the competitiveness of Volvo in the small, and very competitive, luxury car market.
Volvo are prepared to launch new cars this year which would be E20 capable, but unlike the likes of Ford who dived in and got burned 2-years ago, they are likely to wait until their is actually some E20 fuel available at the pumps first, and will study the E20 campaign further, and seek a clearer understanding of the specification and standard of the proposed E20 fuel from the Thai Government.