Thai Automakers Expect Market to Recover in 2017

Consumer caution and the hangover from a tax-driven sales jump a year ago, saw Thailand’s new-vehicle sales slump 15.3% in November to 64,771 units.

Toyota Thailand, which collates sales data for the industry, says the latest result left the year-to-date total down 2.3% at 681,930 units.

Still, the Federation of Thai Industries automotive industry club believes a 4-year run of falling sales is nearing an end and raises its 2017 forecast 20,000 units to 800,000.

It cites a recovering economy and the end of a 5-year lockup period for vehicles bought under the government’s first-time car-buyer scheme for its forecast 6.7% increase on this year’s expected result.

But before that, the industry group predicts December car sales of 70,000 units, down from year-ago’s 111,464.

Toyota Thailand Vice President Vudhigorn Suriyachantananont says November saw new-car sales fall 9.4% to 23,306 units and the commercial-vehicle market drop 18.2% to 41,465.

Within the CV segment, 1-ton pickup sales slowed 15.8% to 34,345 units.

Vudhigorn says sales are down year-on-year because 12 months ago there was a slew of new model releases and buyers flooded salesrooms ahead of an excise tax increase.

After 11 months, new-car sales were down 5.3% at 250,360 units, while the CV segment was off .05% at 431,570.

Toyota held its comfortable lead in November with sales off 4.2% to 23,549 units. Isuzu followed, up 3.7% to 12,010 units, while Honda slipped 18.2% to 7,389.

The car market saw Toyota rise 2.1% to 8,947 units, ahead of Honda, down 20.5% at 5,635 and Mazda, off 18.9% at 2,045.

Toyota topped the CV segment last month, down 7.7% at 14,621 units. Isuzu followed, up 3.7% at 12,010 units, ahead of Ford, down 11.8% at 3,785.

Within the CV segment, Toyota led the 1-ton pickup market, sliding 10.2% to 13,568 units. Isuzu rose 3.7% to 10,772 units and Ford tumbled 9.7% to 3,621.

FTI automotive industry club spokesman Surapong Paisitpatanapong tells the Bangkok Post he sees vehicle sales recovering next year because of a positive forecast from the World Bank.

The bank raised its forecast for Thai GDP growth 0.1 percentage point to 3.2% next year, anticipating a pickup in exports because of the U.S. economic recovery.

The end of the compulsory 5-year ownership period for vehicles bought under the first-time car buyer scheme will see those owners returning to showrooms.

“Some 20,000-30,000 buyers in the government’s first-time car buyer program are expected to buy new cars, so the club is optimistic about market sentiment next year,” Surapong tells the newspaper.

“I am also confident that financial institutions will ease their lending approval for car buyers once they witness a better economy and declining household debt.”