Mitsubishi spots growth after 4-year slump

Mitsubishi spots growth after 4-year slump

Thailand's car market will climb 5% to 900,000 vehicles per year after four straight years of decline, said the chief of Mitsubishi Thailand.

"This is the first year the car market has picked up after four years of contraction that was fuelled by myriad factors, including the expiry of the Yingluck Shinawatra government's first-time car buyer scheme, a high level of household debt, declining farm product prices and a slow economy, said president and chief executive Morikazu Chokki.

"The market started picking up in 2017, especially after the government's stimulus measures and megaprojects began driving the overall economy," he said, adding that he expects Thailand's GDP to grow by 3.5-4.5% next year.

"These factors will build positive momentum going into 2018, and will expand to the car industry as well as other sectors of the economy. A 10% rise in the country's exports and an increase in consumption also contributed to the overall economic growth," he said.

Mr Chokki said Mitsubishi aims to capture more than 8% of the market next year, after the launch of two new models, including the Indonesia-made Xpander multi-purpose vehicle.

The company reported sales of 54,454 vehicles from January to October, a 22.7% year-on-year increase. During this period, its market share climbed 0.7 percentage points to 7.9%.

Mitsubishi is the fourth largest car seller in the country, after Toyota, Isuzu and Honda.

According to the Federation of Thai Industries (FTI), car sales from January to October rose by 11.7% to 689,266 units.

Mr Chokki projects 850-860,000 vehicles will be sold in 2017, up 10-11%.

Mitsubishi was hurt by the decline in the overall vehicle export market, which decreased by 6.3% to 940,820 units from January to October, said Mr Chokki, citing FTI figures.

Vehicle shipments were impacted by a slowing Middle East economy, which accounts for 4% of Mitsubishi's exports, said Mr Chokki.

"Europe, China and Mexico, where a large part of the company's exports go, are performing well, so the firm hasn't been impacted to the same extent as other carmakers," he said.

"From January to October, Mitsubishi exported 270,000 units of both completely built-up (CBU) and completely knocked-down (CKD) units, the same amount as last year. That is why we are confident that the goal of exporting 326,000 CBUs and CKDs this year is feasible," said Mr Chokki.

Mitsubishi will maintain its 320,000-330,000 unit export target for next year, as the global economy expands moderately by 2%, he said.

Mitsubishi is the second largest car exporter in Thailand after Toyota.

Mitsubishi now operates three production facilities and one engine factory at Laem Chabang Industrial Estate.

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