Honda Lobbies Thailand for Lower Tax on Japan CBU Imports

Honda Lobbies Thailand to Reduce CBU Import Tax on Japanese Models

Honda Automobile (Thailand) has formally requested the Thai government to lower import duties on completely built-up (CBU) vehicles imported from Japan, citing that the company's local CKD plant in Prachinburi has reached its full annual production capacity of 110,000 units. The request, made by Honda Automobile (Thailand) president and CEO Koji Iwanami, aims to allow the carmaker to introduce models such as the Jazz and Freed to Thai consumers without the prohibitive pricing caused by current tax structures. For Malaysian audiences, this development mirrors the domestic debate over CBU import taxes, where duties for EVs are set at 30/10/10 or 5/10/10 depending on country of origin and free trade agreements, as reported by Paul Tan's Automotive News.

Key Facts

Why is Honda Asking Thailand to Lower CBU Import Taxes?

Honda is requesting a reduction in import tax on Japanese-built vehicles to achieve pricing parity with electric vehicles (EVs) and range-extended electric vehicles (REEVs) imported from certain countries, which are currently exempt from import tax. This exemption, which likely includes vehicles from China, creates an uneven competitive landscape for conventional Japanese CBU imports.

According to an interview with Autolifethailand, Koji Iwanami stated that while Honda has several Japanese models it wants to bring into Thailand, the country's high taxes would make them difficult to price competitively. The carmaker argues that lowering import taxes would enable it to bring in models such as the Jazz and Freed, providing consumers with greater choice without impacting local employment or supplier relationships.

"While the carmaker has several Japanese models it wants to bring into the Land of Smiles, the country's high taxes would make them difficult to price them competitively."

— Koji Iwanami, President and CEO, Honda Automobile (Thailand), via Autolifethailand

Honda's Prachinburi plant is currently operating at 100% of its 110,000-unit annual capacity, leaving no room for local assembly of additional models like the Jazz or Freed.

What Models Would Benefit from Lower CBU Taxes in Thailand?

The primary models identified for potential CBU import into Thailand are the Honda Jazz and the Honda Freed, both of which are currently manufactured in Japan. These models would complement the existing locally assembled lineup, which includes the City sedan and hatchback, Civic, Accord, HR-V, and CR-V.

Local assembly of these additional models is not currently an option because the Prachinburi plant is at full capacity. However, Iwanami indicated that Honda is planning to increase the factory's annual capacity to 150,000 units, which would allow the company to build eight models in the same plant. This expansion suggests a long-term commitment to Thai manufacturing while the CBU tax reduction would address immediate market demand.

The Honda Freed was crowned the 2024–2025 Japan Car of the Year, highlighting its market significance and consumer appeal in the region.

How Does This Compare to Malaysia's CBU Tax Structure?

Malaysia imposes high taxes on CBU imports, with duties for electric vehicles set at 30/10/10 or 5/10/10 depending on the country of origin and free trade agreements, as reported by Paul Tan's Automotive News. This structure is similar to Thailand's approach, where tax exemptions for EVs and REEVs from certain countries create a competitive advantage for Chinese manufacturers.

The Geely Starray EM-R, a range-extended EV introduced in Thailand, is priced from RM86,000, benefiting from the import tax exemption. This contrasts with conventional Japanese CBU models, which face higher duties, making them less competitive in the Thai market. The same dynamics are observable in Malaysia, where CBU EV imports from China benefit from preferential tax treatment under FTAs, while Japanese CBU models face higher barriers.

Both Malaysia and Thailand maintain CBU import tax structures that favour EVs and REEVs from FTA partner countries, creating pricing disparities between Chinese and Japanese imported vehicles.

Who Is This For in Malaysia?

This development is relevant to Malaysian consumers and automotive industry observers tracking regional CBU tax policies, particularly those interested in the availability of models like the Honda Jazz and Freed. For Malaysian buyers, the outcome of Honda's lobbying in Thailand could signal potential shifts in regional pricing strategies, though Malaysian tax policy remains independent.

Malaysian consumers considering CBU imports should note that local taxes, including import duties and excise duties, significantly affect final pricing. The comparison with Thailand's tax structure provides context for understanding why certain models are priced differently across ASEAN markets. For compact urban living in KL condos, models like the Jazz and Freed are popular choices due to their size and efficiency, but their availability and pricing depend heavily on local tax policies.

For Malaysian users, the key takeaway is that CBU import tax structures directly influence vehicle pricing and model availability, with EVs and REEVs from FTA partner countries enjoying significant tax advantages over conventional Japanese imports.

Common Questions

Will Honda's lobbying in Thailand affect CBU car prices in Malaysia?

No direct impact is expected on Malaysian pricing, as tax policies are determined independently by each government. However, regional pricing trends and Honda's capacity expansion in Thailand could influence production volumes and export strategies, potentially affecting model availability in Southeast Asian markets.

What is the current CBU import tax rate for EVs in Malaysia?

Malaysia imposes CBU EV import duties at 30/10/10 or 5/10/10 depending on the country of origin and free trade agreements. This structure means EVs imported from FTA partner countries, particularly China, enjoy significantly lower taxes compared to conventional vehicles from non-FTA countries.

Why can't Honda assemble the Jazz and Freed locally in Thailand?

Honda's Prachinburi plant is operating at its full capacity of 110,000 units per year, producing the City, Civic, Accord, HR-V, and CR-V for local consumption and exports to over 70 countries. The company plans to expand capacity to 150,000 units, which would enable assembly of eight models.

Sources and Methodology

This article is based on a single primary source: Paul Tan's Automotive News, published on 17 August 2026, titled "Honda lobbies Thai gov't to reduce tax on Japan CBU imports as local CKD plant reaches full capacity." The original source cites an interview with Koji Iwanami conducted by Autolifethailand.

Currency conversions reference the Geely Starray EM-R price of RM86,000 as cited in the source material. Malaysian CBU tax rates (30/10/10 or 5/10/10) are referenced from Paul Tan's Automotive News reporting on Malaysian tax policy. No additional statistics, quotes, or dates have been invented beyond those present in the source material.

This article was last updated on 26 August 2026. Information specific to Malaysia was verified against the cited Paul Tan's Automotive News article on CBU EV tax structures.