Thailand Faces Significant Decline in Automobile Production and Sales

Thailand’s automobile output fell 25.5 percent in September 2024, driven by a slump in domestic sales and stricter lending conditions. Non-performing loans surged to 254 billion THB, impacting car sales that dropped 37.1 percent. Exports also declined by 10.8 percent amid external economic challenges.

BANGKOK — The Federation of Thai Industries (FTI) announced on Friday that Thailand’s automobile production experienced a significant decline of 25.5 percent in September compared to the same month last year. This substantial decrease is attributed to diminished domestic sales, exacerbated by stricter credit conditions imposed by lenders. The FTI reported that non-performing loans in the automobile sector reached 254 billion THB (approximately $7.5 billion) in the second quarter of 2024, representing a year-on-year increase of 29.7 percent. Surapong Paisitpattanapong, the spokesman for FTI’s automotive division, indicated that car sales in Thailand fell by 37.1 percent to 117,000 units in September. Concurrently, exports of vehicles also declined, down by 10.8 percent from the previous year, influenced by economic challenges faced by trading partners as well as the adverse effects of ongoing conflicts in the Middle East. Thailand remains the largest automobile manufacturing hub in Southeast Asia and serves as a critical export base for leading global car manufacturers, including Toyota and Honda.

Thailand’s status as the largest automobile production center in Southeast Asia is vital for both regional and global automotive supply chains. The fluctuations in production and sales figures are closely monitored as they reflect broader economic conditions both domestically and among trading partners. The recent downturn in automobile production and sales serves as an indicator of tightening credit markets and consumer confidence, which can have ripple effects throughout the economy.

In summary, the automobile industry in Thailand has faced considerable challenges in September, with production declines reaching 25.5 percent, largely due to shrinking domestic sales and tighter lending conditions. The FTI’s report highlights a concerning rise in non-performing loans within the sector and decreasing export levels, affected by external economic issues and geopolitical tensions. These trends underscore the need for attention and potentially corrective measures to stimulate recovery in the industry.

Original Source: vietnamnews.vn