Thailand’s new vehicle market continued to deteriorate in August 2024 with sales plunging by 25% to 45,190 units from 60,234 units units a year earlier according to the latest wholesale data released by the Federation of Thai Industries (FTI).
Last month’s decline followed similar drops in previous months, despite a pick-up in economic activity in the country in the second quarter when GDP growth accelerated to 2.3% year on year from 1.6% in the first quarter. This was mainly due to stronger exports, however, while private consumption growth slowed to 4.0% from 6.9% reflecting weakening consumer sentiment.
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The vehicle market has been in sharp decline for well over a year after an initial rebound from the Covid pandemic lows, with sales falling by 9% to 775,780 units in 2023. Vehicle financing companies have tightened lending criteria amid rising non performing loans, resulting in rising numbers of loan rejections while many owners have delayed their vehicle replacements.
Thailand is now south-east Asia’s third largest vehicle market after Indonesia and Malaysia with sales falling by 24% to 399,600 units in the first eight months of 2024 from 524,780 in the same period of last year, according to the FTI data.
Thailand remains the region’s largest vehicle producer, however, despite overall output falling by 17% year on year to 1,005,749 units year to date (YTD), while production for export fell by 6% to 685,361 units.
Domestic sales of internal combustion engine (ICE) vehicles fell by 38% to 265,880 units in the first eight months of the year, including a 40% drop in sales of pickup trucks and passenger vehicle derivatives to 139,530 units while sales of other commercial vehicles were down by 29% at 20,100 units and passenger vehicle sales dropped by 37% to 106,250 units.
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By GlobalDataSales of battery electric vehicles (BEVs) increased 14% to 47,640 units while sales of hybrids increased 60% to 86,080 units.
In the last year Chinese automakers including BYD, GAC Aion, Hozon and Great Wall Motors have begun BEV and hybrid vehicle production at newly built plants in the country. Toyota and Isuzu are scheduled to launch a battery powered pickup truck next year.
Earlier this year the government announced new incentives to help drive up sales of battery powered commercial vehicles, including trucks and buses, with the aim of encouraging investments in local production and supply chain development.
