Car exports are expected to increase to 1 million units for the first time in two years as the Federation of Thai Industries (FTI) pins its hopes on the limited impact of Covid-19 and the global semiconductor shortage on the automotive industry.
In 2020, when Thailand was first hit by Covid-19, car production for export decreased to 704,626 units, down from around 1 million units in 2019. The volume increased to 956,530 units last year.
"We expect car manufacturing for export to grow by 4.54% to around 1 million units this year," said Surapong Paisitpatanapong, vice-chairman and spokesman for the FTI's automotive club.
He attributed the increase to growing demand overseas.
Thailand is a major car producing country, especially in the pickup segment.
Total car production last year stood at 1.68 million units, an increase of 18.12% from 2020, according to the club.
Some 729,175 units of the total amount were produced for domestic sales.
The total production target in 2021 was earlier set at 1.55-1.60 million units.
This year, the club believes total car production can reach 1.8 million units, with 800,000 to be sold domestically and 1 million to be exported.
"The export sector looks set to be healthy and benefit the Thai automotive industry this year," said Mr Surapong.
However, production for export may miss the target if the global semiconductor shortage is not settled and there may be a negative impact on the global economy if the spread of Omicron cannot be controlled, causing countries to reimpose lockdown measures, he said.
FTI believes the chip shortage will end in the next two years because a new Japanese chip making plant will be established, supplying more semiconductors to automakers.
Car companies earlier faced a severe chip scarcity which caused some companies to adjust their production plans by delaying production of some car models, including electric vehicles.
In December 2021 alone, car production increased by 7.89% year-on-year to 154,368 units while motorcycle manufacturing rose by 6.34% year-on-year to 217,423.
The club earlier said bookings at last month's Thailand International Motor Expo were expected to hit the target of 30,000 cars as Covid-19 safety concerns led people to buy more vehicles to avoid using public transport.