First-car buyers reversals may affect Thai auto industry

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BANGKOK, Mar 26 – A slowdown in auto deliveries to first-car buyers may have a negative impact on Thailand’s auto industry, which has targetted manufacturing at least 2.6 million units this year, a Thai industrialist said today.

Surapong Paisitpattanapong, spokesman of the auto industry group of the Federation of Thai Industries (FTI), said 600,000 cars have yet to be received by customers who paid booking fees last year so as to be entitled to the government’s tax rebate for first-car buyers. The policy expired on Dec 31.

If purchase cancellations exceed 20-30 per cent, the Thai auto industry will not achieve the total production volume of 2.6-2.7 million units it had expected for this year, he said.

“We need two more months before we can evaluate the situation. Bookings in the upcoming Bangkok International Motor Show will be one of the crucial factors,” said Mr Surapong, who painted a positive outlook for the Thai auto market this year with eco cars and pickup trucks continuing to  take the sales lead.

He said this year’s auto exports will increase to 1.1 million units while domestic sales will expand from 1.43 million units last year to 1.5 million units.

Adisak Rohitasune, senior vice president of Honda Automobile Thailand, predicted a five per cent growth of auto sales volume in Thailand this year, or 1.4 million units.

The government’s first-car policy has greatly contributed to the growth of auto sales in Thailand last year, he said.

He pointed out that the state’s Bt2 trillion investment in the kingdom’s infrastructure will be a boon to the auto industry, as more capital will be injected into the economic system and contribute to the public’s higher purchasing power.

Mr Adisak stood firm that Honda will not relocate its plants from Thailand to Indonesia, and that Thailand will be the company’s largest production base in Southeast Asia.

He said the appreciating Thai currency has a negative impact on auto exports, and that the appropriate exchange rate should be around Bt30 against the US dollar.