Slow economic prospects and myriad risks have prompted Toyota Motor Thailand to cut its domestic sales target to 280,000 vehicles this year from an earlier projection of 330,000.
The cut means the Japanese car maker's sales will fall for three years in a row.
Toyota yesterday reported its sales fell by 24.9% in the first half of the year to 123,125 vehicles, with its market share falling to 33.4% from 37.1%.
Sales of its passenger cars totalled 53,285, down by 30.3% year-on-year, while sales of its commercial vehicles reached 69,840, down by 20.2%.
President Kyoichi Tanada said the company had to face a spate of negative factors that had engulfed the country's automotive market, particularly weak consumption and high household debt.
The private sector has also become wary of spending and new investment.
"Despite better sales in the second half, I feel that this year will be the toughest one for Toyota since I started my position here in 2009," Mr Tanada said.
Toyota also revised down its forecast of Thailand's overall vehicle sales from 920,000 to below 800,000 this year.
The overall market from January to June fell sharply by 16.3% to 369,109 vehicles. Passenger cars totalled 146,862 units, down by 20.1%, and commercial vehicles stood at 222,247, down by 13.6%.
"The government should speed up its budget disbursement to stimulate the economy, which is the only driver to boost the automotive market," said Mr Tanada.
"The Japanese government, for example, stimulated its sluggish economy with a money injection to generate the private sector's confidence, then it increased value-added tax."
He forecasts the Thai market will take until 2018 to recover its sales to 1 million vehicles.
Toyota still maintains its export target at 390,000 vehicles this year, down by 8.4% from a year earlier and marking a contraction for the third straight year. Toyota's exports are estimated to represent 32.5% of the country's vehicle exports this year.
In the first half of this year, Toyota shipped 163,403 vehicles, down sharply by 29%.
Toyota accounted for 28.4% of first-half vehicle exports, which rose by 2.86% to 576,073 units.
"Although Toyota has launched the Hilux Revo pickup truck to gear up its shipments in the second half, the company remains concerned about global economic prospects that may affect shipments," said Mr Tanada.
Early this month, Toyota made the first shipment of 2,700 Hilux Revo pickups to 120 countries and territories from Chon Buri's Laem Chabang port. It plans to export 186,000 Hilux Revos this year.
The Hilux was launched in 1968. Thai-made versions since 1998 have amassed 1.65 million sales domestically and 2.4 million exports.