Krungsri Auto aiming for one-third of EV loan market
published : 25 May 2023 at 05:04
newspaper section: Business
writer: Somruedi Banchongduang
Krungsri Auto, a leader in automotive finance under the Bank of Ayudhya, wants to capture the electric vehicle (EV) lending market by targeting a one-third market share this year.
The company forecasts new motorcycle sales of 1.7 million units this year, a 6% decline year-on-year, mainly attributed to a high base effect.
Of this amount, more than 1.5 million units are likely to be traditional motorcycles, down by 7% year-on-year, while 72,500 units are big bikes, up by 1%.
Some 30,000 units are expected to be electric motorcycles, a gain of 203%, said Chayathip Phanmanee, managing director of Ayudhya Capital Auto Lease Plc under the Krungsri Auto marketing brand.
Of the 30,000 electric motorcycles, purchasers of around 6,000 units are expected to opt for loans and Krungsri Auto aims to earn a market share of 2,000 units, accounting for one-third.
Given positive demand for both electric car and motorcycle segments, this could contribute to the growth of company's EV financing business.
The company unveiled two business strategies to deliver future-ready solutions in response to each preference of automobile users.
First, it will continue to provide comprehensive EV loan solutions across all segments, brands and models through a customer-based lending approach and best deal offerings, covering interest rates, campaigns and privileges.
Second, with the expansion of its mobility ecosystem on the GO Application by Krungsri Auto, it will explore new partnership opportunities with different stakeholders within the EV industry to create useful content and features, as well as a complete lifestyle experience for EV users.
Krungsri Auto is the industry leader in auto lending with a loan portfolio worth 37 billion baht.
The company aims to grow new car loans to 19.3 billion baht this year, down by 3% compared with last year, in line with estimated new car sales dipping by 3.94% from the previous year.
Of this amount, 1.5 billion baht's worth of new loans would be generated from the digital platform, rising from 1.1 billion baht last year.
Ms Chayathip said rising interest rates would not impact the company's auto loan growth this year.
According to Krungsri Research Center, the Bank of Thailand has continued to increase its policy benchmark rate to reach a terminal level of around 2% from its present level of 1.75%.
"If the central bank hikes the policy rate to 2%, the company would maintain a fixed interest rate for auto loans," Ms Chayathip said.
The flat rate charged for both regular motorcycle and electric motorcycle loans is the same rate at 1.07% a month, while big bikes are charged at 3.29% per year.
The company has controlled non-performing loans for auto lending at a satisfactory level, particularly for the EV segment, she said.
EV buyers typically have a high level of income and financial discipline, said Ms Chayathip.