New vehicle sales in Thailand continued to decline in February, by 10.8% to 63,948 units from already weak year-earlier sales of 71,680 units, according to the Federation of Thai Industries (FTI).
The local automotive market was widely expected to begin its recovery in the first half of this year, after sales plummeted in 2014. The almost 11% decline in February comes on top of a 45% drop in the same month of last year.
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The domestic economy has failed to pick up momentum amid weak consumer and business sentiment and high household debt. Exports also declined by over 3% in the first two months of the year.
Full-year GDP growth forecasts have been rolled back in the last week following the release of weaker-than-expected export data. The Asia Development Bank now expects full-year GDP growth of 3.6% instead of 3.9%, while the local Kasikorn Research Center cut its growth forecast from 4% to 2.8%.
Thailand’s vehicle market has been hit by political volatility and uncertainties over the past 18 months. Vehicle sales in Thailand were dowb by around a third in 2014 to 881,832 units. Political upheaval is estimated to have dragged annual economic growth down to below 1% in 2014. Domestic consumption has also been hit by high household debt and low agricultural and commodity prices.
– down by a third compared with 2013.
