Vietnam’s domestic automaker VinFast Auto Ltd is delaying plans to roll out its dealer network in Thailand following a sharp decline in overall passenger vehicle sales in the country in the last year, according to local reports.

VinFast, which is now focused on producing battery electric vehicles (BEVs), has stepped up its expansion in neighbouring southeast Asian markets this year - having launched sales operations in Indonesia and Philippines in the last few months.

The overall Thai vehicle market plunged by 24% to 308,027 units in the first half of 2024, according to data released by the Federation of Thai Industries (FTI), amid sluggish economic growth and weak domestic consumer sentiment. The industry association last month lowered its full-year 2024 domestic market forecast to 550,000 units from 750,000 earlier in the year, with the sharp decline expected to continue in the second half of the year.

BEV sales in Thailand are reported to have increased by 24% to 49,281 units in the first half of 2024, but competition has intensified significantly in recent months with more Chinese brands establishing operations in the country. The Thai BEV market is currently dominated by BYD Auto, which sold over 11,000 units in the first six months of the year, followed by Neta, Deepal and Great Wall Motors.

A VinFast spokesperson told Bloomberg this week the company will "carefully evaluate" the timing of its BEV sales in the country.

Last month VinFast lowered its full-year global BEV delivery forecast to 80,000 units from 100,000 previously, after first-half sales doubled to 21,750 units in the first half of the year. The company is reported to have also delayed the planned opening of its US plant to 2028, from its original schedule of late 2024, reflecting slower than expected growth in the country’s BEV market.