Thailand Motor Expo Exhibitors Thinking Positive

Automakers participating in the 31st Thailand International Motor Expo are not letting rising car-loan rates, falling vehicle sales and martial law under a military dictatorship dull their optimism.

Organizer Kwanchai Paphatphong predicts attendance at the 12-day event opening Nov. 29 will top 1.5 million people, up from 1.38 million a year ago.

Kwanchai tells The Nation newspaper he expects the last big buying event of the year will generate sales of 45,000 to 50,000 vehicles, up from 41,000 in 2013, and bring in TB60 billion ($1.8 billion), including TB55 billion ($1.67 billion) for the 40 vehicle producers exhibiting and TB5 billion ($152 million) for parts makers.

Both Ford, which sold 2,929 units at the show last year, and Chevrolet, with 1,604, are exhibiting again this year, as is market leader Toyota, which booked 9,075 sales at the 2013 event.

Kwanchai’s forecast comes despite a national market down 37% to 648,410 units after nine months, with car deliveries off 45% and commercial-vehicle sales down 30%.

Meantime, the Bangkok Post reports auto-leasing loan providers are raising interest rates for new car loans by 10-15 basis points, citing higher financial costs caused by increasing numbers of bad vehicle loans.

Interest rates for car loans now range from 2.65%-2.75%.

Thanachart Bank Senior Vice President Tirachart Chiracharasporn says the bank will focus on existing clients and pay attention to asset quality amid the tough economic situation which has curtailed car purchases.

Thanachart Bank, the biggest loan business in Thailand with a portfolio of TB435 billion ($13.2 billion), expects new-vehicle sales to range between 820,000 and 850,000 units this year and rise to 930,000 in 2015.

“Despite other leasing companies offering promotional campaigns at zero-rate interest or even offering no-down-payment deals, demand for new cars remains weak,” Tirachart says.