Total domestic car sales are expected to rise for the first time in five years in 2017, by 4.06 percent to 800,000 units, Toyota Motor Corp's Thai unit said on Tuesday, citing new models and strong government spending among factors.
Toyota, which commands about a third of the Thai market, predicted its own 2017 auto sales in the Southeast Asian nation to rise 8.1% to 265,000 vehicles from last year, Kyoichi Tanada, president of the Toyota Thai unit, told reporters.
The end of a five-year restriction on people selling cars bought under a government subsidy scheme will also help boost car sales, he said.
Overall domestic car sales contracted 3.9% in 2016, the fourth straight year of decline, hurt by weak consumption and the fading effect of the car scheme that ended in 2012, when sales surged.
Mr Tanada said 2016 was "a tough year" for the Thai auto market, despite government measures to spur economic growth.
The military government has introduced stimulus measures and ramped up investment in infrastructure projects in a bid to revive growth in Southeast Asia's second-largest economy, which has lagged peers.
Thailand is a regional production and export hub for the world's top carmakers, and the sector accounts for about 10% of the nation's gross domestic product.
Mr Tanada said the trade protectionism of the United States should not have an impact on the firm's exports and imports in Thailand.
"We don't have any direct business here with the US whether it's the export or imports there," Mr Tanada said, adding about a third of its exports from Thailand go to the Middle East region.
However, car exports from Thailand are expected to drop 11% to 282,000 units this year, largely due to fewer orders from Middle Eastern countries as oil prices stay low, he said.