Thai 2020 domestic car sales could fall by 30-50% as virus hits demand

[BANGKOK] Domestic car sales in Thailand may drop by 30-50 per cent this year from last year's one million vehicles as the coronavirus hit demand, the Federation of Thai Industries (FTI) said on Thursday.

Sales may be 700,000 cars this year if the outbreak stays under control in June or 500,000 units if infections continue locally into September, Surapong Paisitpattanapong, spokesperson of the FTI's automotive industry division, told a news briefing.

Thailand is a regional vehicle production and export base for the world's top carmakers. The industry accounts for about 10 per cent of gross domestic product and provides about 700,000 jobs.

Sales in May tumbled 54.12 per cent from a year earlier to 40,418 units, after plunging 65 per cent in the previous month.

"People are still not confident in the economy, while auto loans have still been tightened," Mr Surapong said.

But sales rose by 34 per cent from April, helped by government steps to contain the virus.

A NEWSLETTER FOR YOU

Friday, 8.30 am

Asean Business

Business insights centering on South-east Asia's fast-growing economies.

Sign Up

Car production is expected at 1.0-1.4 million vehicles this year, equally for domestic sales and exports, Mr Surapong added.

"Production picked up from April's level, which was the lowest in 30 years. It may have bottomed out if there is no second wave," he said, referring to the possibility of a resurgence of the virus.

The FTI previously forecast production of two million cars this year versus last year's 2.01 million.

The decline in production would reduce revenue by 300 billion baht (S$13.40 billion), said FTI president Supant Mongkolsuthree.

Thailand has fared well so far in handling the outbreak, with 3,141 people infected, the majority of whom have recovered. It has been 24 days without a domestic transmission and has removed most restrictions in a bid to revive the economy.

REUTERS