The country's car manufacturing target for 2024 may be downgraded as production continues to dip, with a sluggish economy affecting car sales, according to the Federation of Thai Industries (FTI).
Earlier this year, the FTI set the production target at 1.9 million cars, a year-on-year increase of 3.15%, with 1.15 million for export and 750,000 for domestic sales.
In April, total car manufacturing decreased by 11% to 104,667 units, especially in the pickup segment, which plunged 45.9%, while the passenger car segment decreased 5%.
The fall was attributed to a weak economy, said Surapong Paisitpatanapong, vice-chairman of the FTI and spokesman for its Automotive Industry Club.
From January to April, car production dove by 17% year-on-year to 518,790 units.
"The economy has slowed, while banks continue to tighten car loan criteria to avoid non-performing loans as high household debt weakens consumer purchasing power," said Mr Surapong.
The federation has yet to make a decision on a new car manufacturing target because it wants to monitor economic improvement over the next two months, he said.
Mr Surapong expects state budget spending, which was approved by the House of Representatives in March, to bolster the overall economy, following a months-long delay in budget planning for fiscal 2024, which started on Oct 1 last year.
He also suggested the government launch new stimulus measures to grow the economy.
According to the FTI, domestic car sales in April decreased by 21.5% year-on-year to 46,738 units, attributed mainly to the budget spending delay, banks' stricter criteria for auto loans and weak purchasing power. From January to April, car sales plunged by 23.9% year-on-year to 210,494 units.
Auto shipments last month were similarly bleak, with the volume decreasing by 12.2% year-on-year to 70,160 units, partly attributed to the long Songkran holiday reducing the number of working days that month.
During the first four months this year, car exports decreased by 3.6% year-on-year to 340,685 units.