Thai car sales could fall 16% in 2013 following a record last year when the industry was bolstered by government subsidies for first car buyers.

This would see a decline to 1.2m from 1.43m vehicles.

Kyoichi Tanada, president of Toyota’s Thai unit, told a news conference that he expects his company’s 2013 sales to fall 3% to 500,000 units. However, Thailand is a big export hub for the carmaker - it aims for shipments of 412,000 vehicles worth THB168bn this year, plus THB70bn of auto parts.

In 2012, Toyota auto sales jumped 78% to 516,086 vehicles, with passenger cars up 62.8 percent.

Toyota plans to invest US$404m in a second Thai plant at the Gateway industrial park to produce environment friendly cars as well as more for export. The plant is expected to be completed in the middle of this year, boosting output to 300,000 units a year from 220,000.

Vice chairman Ninnart Chaithirapinyo said risks to exports included a stronger Thai baht, caused by capital inflows, and economic problems in the US and Europe.