BANGKOK: Thailand’s automotive industry suffered a 19.28% drop in manufacturing during the first 10 months of 2024 compared to the same period the previous year, the Federation of Thai Industries (FTI)’s Automotive Industry Club reports.
Auto manufacturing from January to October was 1.24 million units, with 384,952 units for domestic sale, and 861,916 units for export, said the club’s vice-president Surapong Paisitpattanapong.
He added that domestic sales in October totalled 37,691 units, contracting 36.08% from September, and was the lowest in 54 months, or since the Covid-19 lockdown.
Surapong attributed the decline in auto sales and manufacturing to stricter loan criteria used by financial institutes in a bid to tame non-performing loans (NPLs).
Total auto loans as of the third quarter this year stood at 6.36 million accounts, dropping 3% from the previous year, or by 199,655 accounts, and valued at 2.46 trillion baht, dropping 5.8% year-on-year.
NPLs in the automotive sector jumped nearly 30% year-on-year in seven months of this year to over 259.33 billion baht.
The loans in the special mention group also rose to 208.57 billion baht.
Surapong added that another factor contributing to contracting auto exports is the impact of the Israel-Hamas and Russia-Ukraine wars, which have decreased auto demand in several countries.
This prompted the FTI to adjust down Thailand’s auto manufacturing target this year from 1.9 million to 1.5 million units, valued at around 240 billion baht. This estimation is the lowest in four years.
FTI chairman Kriengkrai Thiennukul said that the decreasing auto manufacturing would likely affect operators in the supply chain, mainly parts manufacturers.
“We could soon see parts factories reducing their working days from currently three days a week to only two days a week,” he said. — The Nation/ANN
