Car market confident 2020 sales will hit 1m
Sector sees recovery in year's second half
Local car distributors remain optimistic that the car market will reach 1 million sold for a third straight year in 2020, with an economic recovery predicted in next year's second half.
The car market in the first 10 months of 2019 stood at 838,968 units sold, up 0.7% from the same period last year, according to a report from the Federation of Thai Industries (FTI). But the market has contracted for five months in a row since June.
The FTI said the two remaining months of 2019 could push the total past 1 million units, compared with 1.04 million a year earlier.
Chanchai Trakarnudomsuk, president of Mazda Sales Thailand, said the domestic market in 2020 will be capable of reaching 1 million cars sold because the government's stimulus measures will be in place for a whole year.
"The measures are not only for grassroots people, but also to stimulate overall economic engines such as consumption and investment," he said. "The central bank's measures to control auto loan approvals from financial institutions will be postponed from a tentative plan to take effect in early 2020, so there is no worry for the lending sector."
Morikazu Chokki, president and chief executive of Mitsubishi Motors Thailand, said the car market in the second half of 2019 is suffering from broad economic sluggishness.
"When the economy slows down, the car market performs in the same direction," he said. "The contraction is not only in Thailand, but also other countries globally, pressured by trade war tensions. We expect Thai GDP in the second half of 2019 to bottom out, but overall 2020 sentiment is hard to predict."
Although the 2019 market is looking to stay flat at 1.02-1.03 million cars, local sales in 2020 will not fall to 900,000 units, Mr Chokki said.
Mitsubishi's projection for 2020 sales is a 1-million-car market with hopes for improved sentiment, he said.
Takeshi Kazahara, vice-president of Tri Petch Isuzu Sales, said 2020 car sales will decrease slightly from 2019 because of unpredictable factors such as trade disputes, the US presidential election, Brexit, Hong Kong's political turmoil, the strong baht and Thailand's tepid exports.
"The positive sentiment for Thailand is the stable political movement, while the government is trying to launch stimulus measures for the agricultural and property sectors," Mr Kazahara said.
Thailand's big picture is still better than in other countries, he said, so the sluggish car market is not a crisis.