Japanese car maker Toyota Motor Corporation plans to set up a new business unit in Thailand this year to rev up sales in Indochina, expecting to sell 125,000 vehicles in the region by 2018 from 54,900 units sold last year.
Visitors throng an exhibition of new car models in Thailand. Annual car sales in the country have averaged 1.05 million vehicles over the last five years, according to Toyota. PATTARACHAI PREECHAPANICH
The new unit, Mekong Region Virtual Company, will be handled by Toyota Motor Thailand, said Kyoichi Tanada, president of Toyota Motor Thailand.
"The Indochina market may be very small now, but our parent company aims high for the region, where the population totals about 240 million people including Thailand," said Mr Tanada. "The imminent Asean Economic Community will be the key driver for vehicle sales in the region."
According to Toyota, Thailand's annual car sales averaged 1.05 million units over the last five years, well ahead of sales in Vietnam (150,000), Laos (20,000), Cambodia (3,000) and Myanmar (2,000).
Toyota Motor Thailand operates sales and dealership offices in Vietnam and Cambodia. New offices in Laos and Myanmar are due to open some time this year.
"Toyota now has a 33% market share in Vietnam (41,000 units), 50% in Laos (12,600 units) and 33% in Cambodia (1,100 units)," said Mr Tanada.
In Myanmar, the company sold only 200 vehicles last year, giving it a market share of only 10%.
In Thailand, Toyota sold 327,027 vehicles last year, down 26.6%. It has a 37.1% share of the Thai market.
Of Toyota's sales last year, commercial vehicles accounted for 53.6%, with passenger cars accounting for the rest.
Toyota aims for its Thailand sales to increase slightly by 0.9% this year to 330,000 vehicles, with a market share of 35.9%.
Sales of Toyota's passenger cars are expected to decline by 2.0% to 148,700 units, while commercial vehicles are tipped to increase by 3.4% to 181,300.
Mr Tanada said the Thai market was getting almost saturated now in Greater Bangkok, where car ownership is about one car per two people.
He said only the provincial market had room to grow in Thailand, as the ratio in the provinces is still about one car per 10 people.
"Potential sales in other Indochina countries are bountiful, as many people have never owned a single car," he said.
Vehicles sold in Indochina will be exported mainly from Toyota's three Thai factories, with some to be shipped from its Indonesian plant.
"We expect the new Indochina strategy will help boost production capacity of the three plants in Thailand to an average of 900,000 to 1 million vehicles per year in the future from 770,000 now," Mr Tanada said.