Projection of Thailand’s Automobile Market in 2024

Thailand’s automobile market is expected to fall below 800,000 units in 2023, settling down to around 787,000 units due to factors such as a decline in consumer purchasing appetite triggered by rising interest rates. On the other hand, in 2024, sales are predicted to recover to a level of over 800,000 units, considering the effect of the economic stimulus measures of the new Srettha administration, which was inaugurated in August 2023.

Since the beginning of 2023, automobile sales have been down from the previous year in every month, except May, until September. Sales of passenger vehicles in the January-September period increased by 9.4% year-on-year, driven by the strong performance of BEVs, while sales of light commercial vehicles decreased by 15.4% year-on-year due to a slump in pickup truck sales. According to the National Credit Bureau (NCB), which manages credit information, as of September 2023, the amount of non-performing loans in car loans has reached 207 billion THB, an increase of 20.9% from the same period last year. The pace of increase accelerated compared to the end of June of the same year, which brought about stricter screening for car loans. Although the inflation rate has been on a decline since the beginning of 2023 due to the hike in policy interest rates, the real GDP growth rate, which was 2.6% in the first quarter, slumped to the 1.0% level in the second and third quarters.

In response to the economic slump, the new Srettha administration has set a basic policy that places top priority on economic recovery. In his policy speech, Prime Minister Srettha Thavisin said that the government plans to take measures to boost the economy, such as announcing the idea of distributing 10,000 THB in digital currency to citizens over the age of 16 in 2024. The government also plans to implement relief measures for farmers, small and medium-sized businesses, and individuals to help with the increase in bad debts on automobile loans. With these economic stimulus measures, it is predicted that the automobile market will recover to 830,000 units.