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Thailand’s Automotive Industry Showed Decline in September 2024
Auto production and sales in Thailand witnessed substantial drops in September 2024, with all sectors, including exports, experiencing downturns. Key factors contributing to these challenges in the industry were stricter loan approvals and elevated household debt levels.
In September 2024, Thailand’s auto production and sales declined significantly, with all sectors, including exports, facing downturns.
Key Takeways
- In September 2024, Thailand’s auto production and sales declined significantly, with all sectors, including exports, facing downturns. Stricter loan approvals and high household debt levels were major challenges. Total auto production was 122,277 units, down 25.48% from September 2023, and the year’s first nine months saw an 18.61% decrease to 1,128,026 units. Export production decreased by 15.78% year-on-year, while domestic production dropped by 42.31%.
- Domestic car sales in September hit a 53-month low at 39,048 units, a 37.11% year-on-year drop. High household debt and tighter lending conditions drove this decline, with non-performing auto loans reaching 259.33 billion baht. Modest GDP growth, projected at 2.7-2.8% for 2024, also weakened consumer spending and vehicle purchases, further impacting the auto sector.
- Finished vehicle exports fell by 17.67% year-on-year, with 80,254 units shipped in September. Middle East geopolitical tensions disrupted key market shipping routes, weakening demand. Electric vehicle sales dropped, with registrations down 25.81% in September, despite a yearly 11.67% increase. An automotive industry meeting in November will likely revise production and sales targets downward amid concerns over high household debt impacting economic recovery.
Auto production and sales in Thailand witnessed substantial drops in September 2024, with all sectors, including exports, experiencing downturns. Key factors contributing to these challenges in the industry were stricter loan approvals and elevated household debt levels. Total auto production for the month was 122,277 units, marking a 25.48% decline compared to September 2023. For the first nine months of the year, production fell by 18.61%, totaling 1,128,026 units. Export production decreased by 15.78% year-on-year, while domestic production plummeted by 42.31%.
Domestic car sales in September hit a 53-month low, amounting to 39,048 units—a 37.11% year-on-year decrease. This drop was primarily due to tighter lending conditions stemming from high household debt, with non-performing auto loans reaching 259.33 billion baht. Modest GDP growth, projected at 2.7-2.8% for 2024, also contributed to reductions in consumer spending and vehicle purchases.
Exports of finished vehicles declined, with 80,254 units shipped in September, marking a 17.67% year-on-year decrease. Geopolitical tensions in the Middle East disrupted shipping routes, further weakening demand in key markets. Electric vehicle sales fell, with battery electric vehicle registrations dropping by 25.81% in September, though cumulative registrations for the year showed an 11.67% increase.
A meeting of the automotive industry group is scheduled for November to reassess production and sales targets for the year, with anticipated downward revisions. Concerns persist about high household debt and its effects on economic recovery, despite hopes for increased investments spurred by the Board of Investment.
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