Thailand’s car sales drop by 25 per cent this September, the lowest sales in over 4 years. Furthermore, Thailand saw a similar fall in its manufacturing output. This decline prompted the Federation of Thai Industries (FTI) Auto Club to reassess its output targets for the remaining year.
MISSED TARGETS
Thailand’s auto manufacturers may not reach the FTI Auto Club’s intended target of 1.7 million units by the end of the year. This is compounded by continuously decreasing sales over 2024 thus far. Domestic sales units were measured at approximately 438,569 overall as of September 2024. A new target will be announced this November by the FTI Auto Club.
These lowering sales have forced manufacturers to reduce production to curb the current market demand. Thai auto makers have only produced 1.1 million units, a downturn compared to 2023’s 1.3 million in the same period. However, this is not the first time this year that Thailand has lowered its projections. A similar readjustment was made earlier in July 2024.
“The production target for domestic sales should be further cut and this time we may need to reduce the manufacturing target for export, too,” said FTI Auto Club Vice President, Surapong Paisitpattanapon.
ECONOMIC STRAINS
Economic strains on Thai households such as “debt and loan rejections” have constricted citizens’ buying power. “Financial institutions have been employing stricter criteria and rejecting around 60% of auto loan applications in a bid to tame non-performing loans, which have risen to 259.33 billion baht as of July,” said Paisitpattanapon.
The organisation also reported a 10.38% decline in car exports compared to last year. Thailand’s biggest customers are in the Middle East, where rising conflicts have brewed over the last few years. The FTI cited these conflicts as a contributing factor of their lowering 2024 sales and production. Aside from this, Thailand’s overall global car exports have significantly fell.
Car exports this year reached only 768,887 units, down by 6.4 per cent compared to last year for the same period.
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