THAILAND: Thai sales affected by uncertainty
Thailand's vehicle market was stagnant in November, with the 12-day Motor Expo 2007 failing to lift the mood among Thailand's consumers, according to data collected by Toyota Motor Thailand.
Political uncertainty remains the dominant sentiment in the country even after the parliamentary elections held last month.
Sales volumes declined marginally to 57,714 units during the month compared with 57,800 a year earlier, after showing signs of recovery in the preceding months. The November data brings the eleven-month cumulative tally to 566,905 units - 5.1% lower than the 597,609 vehicles sold in the same period of 2006.
Passenger car sales were particularly weak during the month, with deliveries to dealers falling by almost 15% to 13,645 units. Honda experienced the biggest sales decline during the month, with volumes falling by 34.7% to 3,162 units; followed by Chevrolet with a decline of over 47% to 614 units; while Toyota sales dropped by just 2.3% to 8,210 units - to account for over 60% of total deliveries.
Dealer deliveries of one-ton pick-up trucks - which make up the largest vehicle segment - increased by 1.23% during the month to 39,140 units, with the Toyota Hilux the best-selling model with 16,284 units, only marginally down on the previous year. Nissan's sales more than doubled to 2,606 units.
Weak passenger car deliveries in November reflect in particular falling consumer confidence in the Bangkok area, in anticipation of the parliamentary elections held last month. With no party winning an outright majority, the uncertainty will likely continue until an effective coalition is formed.
Any new government eventually formed will likely have ousted prime minister Thaksin's populist PPP party, which was the single most successful party in the elections, at its heart. PPP's success came as a major blow to the army, which seized power last year.
The political establishment, like the electorate, is deeply divided. This could hinder policy-making at a time when economic uncertainty is increasing. High oil prices are pushing up inflation, which will limit opportunities for further rate cuts. The future government is likely to lift public spending to boost economic growth to around 4.5-4.8% in 2008 - which would help the vehicle market recover moderately from 2007 levels.