AP Honda sees tepid sales

AP Honda sees tepid sales

The motorcycle market is likely to grow by just 2-3% in 2015 as purchasing power remains weak, says AP Honda Co, the local distributor of Honda motorcycles.

"The government's economic stimulus measures are unlikely to affect the motorcycle market much, as the people's purchasing power will remain unchanged from this year," director Suchart Arunsaengroj said. "Moreover, most potential motorcycle buyers are farmers suffering from declining prices for their agricultural products, especially rubber."

AP Honda predicts 2014 sales of 1.7 million motorcycles in the overall Thai market, marking the first year of the past three in which domestic sales would miss 2 million.

Thailand's motorcycle sales surpassed 2 million for the first time in 2011 with a figure of 2.01 million. Sales rose to 2.13 million in 2012 before dropping to 2.004 million last year.

"Motorcycle sales always rely on people's income," Mr Suchart said. "Most people are still tightening their belts."

He expects the market will begin recovering in next year's second or third quarter.

Mr Suchart said AP Honda's 2014 sales should top out at 1.35 million units, down by 10%, with market share rising to 77% from 74%.

Despite slowing sales, the company remains upbeat about market trends in the new year, especially for big bikes. AP Honda's sales of 400cc-plus big bikes surged 80% in 2014 to 5,500 units.

The company expects overall sales of big bikes in Thailand to rise by 20% to 18,000 in 2015.

AP Honda runs seven Honda Big Wing branches, in Bangkok's Lat Phrao district, Chiang Mai, Pattaya, Udon Thani, Nakhon Ratchasima, Phuket and Surat Thani.

Outlets are set to open on Rama III and Ratchaphruek roads in Bangkok and in Nakhon Sawan province.

"Unlike the mass market, big bikes are a niche market that is not affected much by the economic slowdown," Mr Suchart said. "We expect the segment will continue enjoying good growth in the long term, as several foreign players have now entered Thailand and the government fully supports foreign firms setting up factories."

AP Honda will unveil its 2015 business strategy and sales view next month.

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