Car manufacturing for export slides 40% amid dip in orders
Thailand's car manufacturing for export from January to May decreased by 40% year-on-year to 72,527 units due to sluggish purchase orders, particularly from the European and US markets, says the Federation of Thai Industries (FTI).
In May, car production for export fell by 23% year-on-year to 13,925 units.
The decrease was attributed to the prolonged semiconductor shortage and the economic slowdown in the US, European and Asian markets, said Surapong Paisitpatanapong, vice-chairman and spokesman for the FTI's automotive club.
"The semiconductor shortage is a main factor that affects the global automotive industry while the Russia-Ukraine war is dealing a blow to the global economy," he said.
The FTI is concerned the problems may affect its car production target in 2022. It earlier predicted car manufacturing would stand at 1.8 million units, with 1 million produced for export.
"We are closely monitoring the semiconductor shortage and expect this problem will persist for at least 1-2 years," said Mr Surapong.
Car exports in May decreased by 3.2% year-on-year to 76,937 units and fell by 48.7% from April.
According to the FTI, global automakers need to increase the prices of some models by around 5-10% this year because of the increase in raw material prices, especially semiconductors.
This may eventually cause an impact on domestic car sales, said Mr Surapong.
In May, domestic car sales rose by 15.1% year-on-year to 64,735 units and increased by 2.06% from April, thanks to the government's easing of lockdown measures to contain the spread of Covid-19 as well as the economic stimulus packages to boost consumer spending.
"But we are worried over the soaring retail oil prices, following the global oil price surge," said Mr Surapong, adding inflation, along with higher household debt, would dampen consumer purchasing power.
- car export