Auto sales and exports both rising
The Detroit of Asia is experiencing a resurgence as exports of vehicles manufactured in Thailand hit a two-year high in September on renewed demand from the Middle East as domestic vehicle sales rose nearly 22 percent during the same month, an indicator of an economy gaining momentum.
“September’s figures are very good. We have to see if such export levels will continue in the remaining months,” said Surapong Paisitpattanapong, spokesman of the Federation of Thai Industry’s Auto Industry club.
Car exports in September were 7.19 percent higher than in the same month one year ago, with manufacturers shipping 120,654 vehicles last month. Exports to the Middle East accounted for 9 percent of the total and were up 7.9 percent in September year on year. Surapong said that the good performance in September could help Thailand surpass its vehicle export target of 1.2 million units this year.
The auto industry is a crucial manufacturing sector for the economy. Car factories employ 10 percent of all factory workers, and the sector contributes roughly 10 percent to the country’s gross domestic product.
Virtually all the major Japanese, European and American car manufacturers have factories in Thailand turning out vehicles both for domestic sales and exports. Toyota is the market leader in domestic passenger car sales. U.S. automakers such as Ford and General Motors have small but growing shares of the domestic market and export the bulk of the cars they build in Thailand.
But the domestic market has been outperforming auto exports in terms of percentage growth so far this year. Domestic car sales rose 21.9 percent year on year in September, and were up 11.5 percent through the first nine months of 2017, totaling 620,715 cars sold.
Passenger car sales rose by 14.9 percent, while sales of commercial vehicles were up 26.6 percent year on year in September, according to Toyota Motors Thailand, which keeps track of auto industry figures in the Kingdom.
Surapong said that he thinks domestic car sales could reach 850,000 units this year, which would be a 10 percent increase over last year. The recovery in the car market is welcome news for the current government’s economic planners as well as the manufacturers.