Car exports heat up as local sales lag

Car exports heat up as local sales lag

Electric vehicle technology captures the attention of visitors during the 2023 Fast Auto Show Thailand & EV Expo, which photo: ended on July 9. (Photo: Wichan Charoenkiatpakul)
Electric vehicle technology captures the attention of visitors during the 2023 Fast Auto Show Thailand & EV Expo, which photo: ended on July 9. (Photo: Wichan Charoenkiatpakul)

Automotive exports from Thailand increased by 12.2% year-on-year to 105,726 units in October, driven by growing demand for pickups, especially in the Middle East, but domestic sales remained sluggish because of high household debt.

Other markets, including Australia, Europe, North America, Central and South America also reported healthy sales last month, according to the Federation of Thai Industries (FTI)'s Automotive Industry Club.

"We see growth potential with car exports because trading countries' economies are improving and consumer purchasing power overseas is not weak or restricted by high household debt," said Surapong Paisitpatanapong, vice-chairman of the FTI and spokesman for the auto club.

Debt in Thailand is blamed for a decline in domestic car sales as banks adopt stricter criteria for auto lending out of concern for non-performing loans.

Car sales in the country decreased by 8.7% year-on-year to 58,963 units in October, with pickup sales plunging by 37.9% year-on-year.

Another factor for the sales decline was the economic slowdown as state budget planning for fiscal 2024 was delayed.

"We hope the 40th Bangkok International Motor Show, slated for Nov 29 to Dec 11, will boost domestic car sales," said Mr Surapong.

Exports appear to be a key business driver for the Thai automotive industry, he said.

From January to October, car exports, including cars powered by internal combustion engines and hybrid electric vehicles, increased by 15.8% year-on-year to 927,625 units.

The club expects the export volume to reach 1.1 million units with a value of 1.1 trillion baht in 2023. Thailand exported 1.2 million vehicles in 2015.

Exports should eventually increase Thailand's car manufacturing, said Mr Surapong.

The club previously downgraded its car production target to 1.85 million units this year from 1.9 million units, following a decline in domestic car sales.

In October, Thailand's total car production decreased by 7% year-on-year to 158,734 units, with manufacturing for export down by 3.5% year-on-year, while production for domestic sales dipped by 11.6%.

The main decline was for manufacturing of pickups.

During the first 10 months of this year, total car manufacturing increased by 0.6% year-on-year to 1.54 million units, according to the club.

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