Thailand’s Auto Industry Looks to Rebound in 2015

Thailand’s new-vehicle sales plunged 33.7% last year as political maneuvering ended in a military coup and an accompanying economic slowdown amid low agricultural-product prices saw buyers keep their hands in their pockets.

But despite the drop to 881,832 units, Toyota Thailand President Kyoichi Tanada says the result still was the country’s third-best annual total behind only 2013 and 2012.

Toyota, which collates national sales data for the industry, says Thailand’s car sales fell 41.4% to 369,839 units. Commercial-vehicle deliveries dropped 26.8% to 511,993, including the 1-ton pickup segment that tumbled 28.4% to 420,829.

Tanada predicts the market will recover somewhat this year with sales rising 4.3% to 920,000 units, including a 7.4% climb in car deliveries to 397,200 and CVs improving 2.1% to 522,800.

“Thailand’s domestic sales will return to normalcy after the end of the after-effects of the first-car-buyer tax-rebate program,” he says in a statement.

The program, which offered tax rebates of up to TB100,000 ($3,071) per vehicle, generated record sales of 1.44 million vehicles in 2012 and 1.33 million units in 2103 – and, as predicted, bled demand in 2014.

“The political maneuvering also psychologically affected consumer buying decision in 2014,” Tanada says. “In 2015, Thailand domestic sales will return to normalcy in line with an economic recovery that will gradually build consumer confidence.”

Nissan Thailand president Hiroyuki Yoshimoto earlier told The Nation newspaper the Japanese Chamber of Commerce reports investors are confident the Thai economy will recover starting early this year, while the automotive industry also will rebound slowly.

Yoshimoto says the military government is trying hard to revive the economy with stimulus spending, while the political scenario is heading toward elections, which will help boost consumer confidence.

The year ended with December sales down 21.4% to 89,504 units, with Toyota dropping 19.8% to 33,073, Isuzu off 12.4% to 15,646, and Honda slipping 11.8% at 13,369 units.

Toyota remained the 2014 sales leader despite a 26.6% retreat to 327,027 units, while Isuzu recorded a 22.3% drop to 160,286 and Honda sank 50% to 106,482.

The car segment saw Toyota falter 20.2% at 151,763 units, followed by Honda, backsliding 51.2% to 94,320 and Nissan, slumping 59.8% to 30,580.

The CV market also was led by Toyota despite a 31.4% skid to 175,264 units, ahead of Isuzu, off 22.3% at 160,286 and Mitsubishi, down 34.4% at 39,498.

Within this, Toyota’s sales in the important 1-ton pickup segment slumped 30.4% to 164,849 units, with Isuzu falling 19.8% to 146,919 and Mitsubishi slowing 34.4% to 39,498.

Ford took over leadership in the non-Japanese contingent, which despite a 25.6% retreat to 38,087 deliveries put it ahead of Chevrolet, which tumbled 54.2% to 25,799.

Toyota’s domestic sales target for 2015 is up 0.9% at 330,000 units, with car deliveries rising 2% to 148,700 and CVs growing 3.4% to 181,300, including a 4.1% gain in 1-ton pickup volume to 171,700.

On the production side, the government’s National News Bureau reports Thailand produced 1.88 million vehicles in 2014, missing its target of 2.1 million. It quotes the Federation of Thai Industries Vice President and FTT auto industry group spokesman Suraphong Phaisitphatthanaphong as saying the 2014 total was down 23.9% from the prior year.

Thailand built 753,800 units for the local market and 1.12 million, or 59.7%, for export.