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Toyota sees 3.8% fall in 2019 total Thailand domestic car sales
[BANGKOK] Toyota Motor Corp expects Thailand's domestic car sales to drop 3.8 per cent to 1 million units in 2019 after a 19 per cent gain last year, as economic conditions are likely to be similar to 2018 while interest rates may increase.
However, the Japanese automaker, which commands about a third of the Thai vehicle market, predicts its own sales in the Southeast Asian country to rise 4.7 per cent from last year to 330,000 cars, Toyota Motor Thailand's President Michinobu Sugata told a news conference on Tuesday.
In 2018, Toyota's Thai auto sales jumped 31 per cent to 315,113 cars.
This year's sales will be helped by the launch of new models and plans to drive domestic sales, Mr Sugata said.
Known as the "Detroit of Southeast Asia", Thailand is a regional production and export hub for some of the world's top carmakers, including Toyota and Honda Motor.
"We expect that the Thai automotive industry will maintain the 1 million unit level as long as the current favourable conditions continue in Thailand, such as government spending to stimulate investment from the private sector and the introduction of new models by various car makers," Mr Sugata said.
The sector accounts for about 10 per cent of the country's GDP and employs a tenth of its workforce in manufacturing.
Last week, Mazda Motor's Thai unit said it was targeting a 5-10 per cent rise in its sales this year, after surging 37 per cent last year.
The anticipated slower domestic sales come at a time when car exports are also falling due to weaker demand from the Middle East, America, and Australia and Oceania.
Thailand's auto sector, which reported strong sales over the past two years, has been a bright spot in an economy hurt by falling electronics exports amid US-China trade tensions and fewer Chinese visitors since a tourist boat accident last year.
However, the country's elevated household debt and its first interest rate hike in more than seven years point to fewer car sales this year.
Some analysts think the central bank may raise its policy rate further this year, which would hurt consumption at a time of slowing economic growth.
The central bank expects Southeast Asia's second-largest economy to grow 4 per cent this year after an estimated 4.2 per cent for 2018.
Still, automakers may use Thailand to manufacture cars for export, as they plan production cuts in China due to declining demand in the world's biggest car market.
However, Toyota has made no decision on this matter, Mr Sugata said.