With Thailand’s vehicle sales down year-on-year for 25 straight months, a major industry group slashes its full-year forecast for the second time in two months.
The Federation of Thai Industries is cutting this year’s projection 5.9% to 800,000 units after lowering it last month to 850,000 from 950,000.
Surapong Paisitpatanapon, a spokesman for the federation’s automotive industry club, tells the Bangkok Post the latest cut is based on negative factors such as slower-than-expected spending by the government after only 40% of the fiscal-2015 budget was spent in the six months ending March 31.
“The Thai economy is in dire need of a cash injection to boost consumer purchasing power and private-sector investment,” Surapong says.
Tighter credit also has dampened car sales, he says. Caution on the part of banks reflects the rising level of household debt and Surapong says the rejection rate for car loans has surged to 30%-50% from the usual 10%.
The federation’s new forecast matches that of Toyota Thailand, which has released first-half statistics showing sales down 16.3% to 369,109 units.
Toyota is predicting the full-year result will struggle to reach 800,000 units.
Last year, sales fell 33.7% to 881,832 vehicles.
Suzuki Thailand Sales and Marketing Director Wallop Treererkngam is even more pessimistic, telling the Post he expects full-year sales to fall to 760,000 units.
Thailand’s new-vehicle sales peaked in 2012 at 1.45 million units before dropping to 1.33 million in 2013 and to 881,832 last year.
