Domestic car sales continued to decline, especially in the pickup segment, falling by 26% year-on-year in February, which is expected to be the lowest level in two years, says the Federation of Thai Industries (FTI).
Total car sales in the country amounted to 52,843 units, down from 71,551 units year-on-year.
"We are worried about the sales decline, but remain positive about economic improvements resulting from state budget spending in the second half of this year," said Surapong Paisitpatanapong, vice-chairman of the FTI and spokesman for its Automotive Industry Club.
The House of Representatives last week voted to approve the 3.4-trillion-baht budget bill for fiscal 2024, which started on Oct 1 last year, after a delay caused by the lengthy process to form a new coalition government following the general election.
Mr Surapong also expects the government to launch more stimulus measures to drive the economy, which should improve domestic car sales somewhat.
Thailand's car manufacturing for the month decreased by 19.2% year-on-year to 133,690 units, with production for export and domestic sales dipping by 9.2% and 32.9% respectively, according to the club. The decrease was attributed to a lack of some parts for pickup manufacturing and lower domestic sales.
Companies reduced production of passenger cars as more imports of electric vehicles (EVs), especially from China, gained market share. Pickup manufacturers slowed their output as banks issued stricter criteria for loans to prospective pickup buyers.
Difficulty in accessing finance remains an obstacle to pickup sales as bankers are cautious about high household debt, which can lead to more non-performing loans, he said.
"Pickups are a real worry. In the past, pickup sales were higher than those for passenger cars. Now their sales volume keeps decreasing," said Mr Surapong.
During the first two months this year, domestic car sales dipped 21.4% year-on-year to 107,657 units, according to the club.