BANGKOK : Car production in regional automaking hub Thailand fell 20.56 per cent in August from a year earlier due mainly to weaker domestic sales amid tightening credit conditions, the Federation of Thai Industries said on Tuesday.
The figure compared with July’s 16.6 per cent year-on-year decline. It was the 13th straight month that production had contracted.
In the January-August period, car production contracted 17.69 per cent from a year earlier to just over a million units, the federation said.
Domestic car sales declined 24.98 per cent in August from a year earlier, after an annual drop of 20.58 per cent in July, it said.
Thailand is Southeast Asia’s biggest autos production centre and an export base for some of the world’s top carmakers, including Toyota and Honda, with pickup trucks among the key vehicles manufactured. It has recently attracted investments from Chinese electric vehicle makers.
About half of the vehicles made are sold domestically, but the sector has suffered from weak demand, due mainly to high household debt and a significant tightening of lending conditions by banks, particularly for pick-up trucks, Surapong Paisitpattanapong, a FTI spokesman, told a media briefing.
He said rising non-performing loans and high consumer debt could lead to half of loan applications for pick-up trucks to be rejected.
Official data showed household debt was 90.8 per cent of GDP in the March quarter, or $484 billion.
In July, the federation cut its domestic sales target for this year to 550,000 vehicles from an earlier forecast of 750,000 units.
EV sales were expected to come in at 76,000 units, below the group’s target of 100,000, Surapong said, even as Chinese EV makers such as BYD established factories in Thailand this year.
The Federation had also reduced its 2024 production target to 1.7 million units in July, down from at 1.9 million vehicles seen
