Thailand's unfavourable economic outlook and escalating political risk are likely to chop motorcycle sales this year to below 2 million for the first time in three years.
AP Honda Co, the distributor of Honda motorcycles in Thailand, expects sales by all producers to be only 1.85 million this year, down 7.68% from 2.004 million last year, which was a fall of 5.92% from 2.13 million in 2012.
The Thai motorcycle market has achieved sales above 2 million since 2011 when sales were 2.01 million.
AP Honda president Chiaki Kato said inactive economic growth played a key part in dragging down sales last year.
Other factors included falling exports, the baht's appreciation, declining prices of agricultural products and shrinking purchasing power.
"Motorcycle sales are likely to get better in the second half of the year, but ongoing political conflict may whittle down economic growth, leading motorcycle sales to fall accordingly," Mr Kato said.
He believes Thailand's motorcycle sales will bounce back to 2 million in 2015 on the economy recovering to reach strong growth of more than 4%.
AP Honda aims to sell 1.4 million motorcycles this year, down 6.23% from 2013 sales of 1.49 million.
Last year's figure represented a marginal increase of 0.54% from sales in 2012.
AP Honda has been the market leader in Thailand for 25 consecutive years, controlling a 74.5% share last year, up from 69.72% in 2012.
AP Honda yesterday announced its three-year business plan for 2014-16 in a strategic move to retain its market leadership.
By 2016, it plans to increase its dealership network from 540 outlets to 1,200 and to introduce 12 new models.
In the first quarter of this year, it plans to launch two new models: the 125cc MSX125 and 150cc PCX150.
The MSX125 is priced at 67,800 baht, while the price of the PCX150 has not yet been disclosed. AP Honda aims to sell 80,000 MSX125 and 40,000 PCX150 models. As many as 90% of Honda's motorcycles sold in Thailand are now produced by Thai Honda Manufacturing Co in Samut Prakan, with annual production capacity of 1.65 million. About 160,000 motorcycles are for export.