Ford Focus Pricing - Thai Government changes excise rate

When Ford designed the Focus for the Thai market it had a clever plan in mind. Thailand announced a scheme, whereby cars capable of running on E20 fuel, gasohol with a mix of 80% petrol and 20% ethanol, would be eligible for a reduced excise rate of 20%. Since the standard rate is 30% Ford's strategy should have afforded them a price advantage over rivals.

As to be expected rivals got vocal about the issue. The main argument was that there is no E20 fuel on sale in Thailand, and so the Focus being able to run on it is not of any real environmental value. Personally I think these companies were simply slow to move and were a bit panicked, given that a 1.8 liter Ford Focus was going to be available in the price range of their 1.6 and 1.7 liter offerings, with the Focus costing between 747,000 and 898,000 baht depending on specification.

But it seems as though the Thai government has changed their minds and listened to the chorus of complaints. Unfortunately for Ford the 20% excise rate is off and the 30% rate is to be applied! It's not clear yet what effect this will have on pricing of the Focus, since the prices were introductory anyway, and were set to rise at the end of the promotion period. But now it seems as though they will be rising considerably more than Ford had planned.

According to todays Bangkok Post Motoring section, the special 20% excise rate on E20 capable cars is to be postponed for four years! If this is true it is a real shame for Ford, but also a bad decision. Thailand needs the auto makers on board if it's gasohol strategy is to succeed. Ford is a market leader in this area, and I believe that their confidence in the Thai government will be strained by this sort of messing. But perhaps Thailand thought it more important to keep the big Japanese boys on side.

If you are considering buying a Focus I would suggest that you try to find out more about this issue, since it is likely to lead to a substantial price increase in the near future. Please don't act purely on this information (it's secondhand and the Post has gotten it wrong now and then!)

23/10/05 Update: New prices will take effect from November! The prices will increase to be 797,000 baht for the Trend spec up to 959,000 baht for the range topping Ghia model. Ouch!