Auto market confident 2020 sales will reach 1 million
The sector experienced a recovery in the second half of the year
A visitor views an MG car at the 36th Thailand International Motor Expo. The show runs until December 10 at Impact Muang Thong Thani. (Photo by Varuth Hirunyatheb)
Local auto distributors remain optimistic that the auto market will hit 1 million cars sold for a third consecutive year in 2020, with an economic recovery expected in the second half of next year.
The auto market in the first 10 months of 2019 was 838,968 units sold, up 0.7% from the same period last year, according to a report by the Federation of Thai Industries (FTI) . But the market has contracted for five consecutive months since June.
The FTI said the remaining two months of 2019 could push the total to 1 million units, from 1.04 million a year earlier.
Chanchai Trakarnudomsuk, president of Mazda Sales Thailand, said the domestic market in 2020 will be able to reach 1 million cars sold because the government’s stimulus measures will be in place for an entire year.
“The measures are not only aimed at local people, but also to stimulate global economic drivers such as consumption and investment,” he said. “The central bank’s measures to control auto loan approvals from financial institutions will be postponed from an interim plan due to take effect in early 2020, so there is no concern for the lending industry.”
Morikazu Chokki, Chairman and CEO of Mitsubishi Motors Thailand, said the auto market in the second half of 2019 was suffering from a general economic downturn.
“When the economy slows down, the auto market moves in the same direction,” he said. “The contraction is not only in Thailand, but also in other countries around the world, under pressure from the tensions of the trade war. We expect Thailand’s GDP to hit its lowest point in the second half of the year. 2019, but the general feeling for 2020 is difficult to predict. “
Although the 2019 market seeks to hold steady at 1.02-1.03 million cars, local sales in 2020 will not fall to 900,000 units, Chokki said.
Mitsubishi’s projection for sales in 2020 is a million-car market with hopes of improving sentiment, he said.
Takeshi Kazahara, vice president of Tri Petch Isuzu Sales, said car sales in 2020 will decline slightly from 2019 due to unpredictable factors such as trade disputes, US presidential election, Brexit, political unrest in Hong Kong, the strong baht and lukewarm exports from Thailand.
“The positive sentiment for Thailand is the stable political movement as the government tries to launch stimulus measures for the agriculture and real estate sectors,” Kazahara said.
The overall situation in Thailand is still better than in other countries, he said, so the sluggish auto market is not a crisis.