Thailand’s June car sales suffer first drop in over 2 years on tighter loans

19, Jul. 2019

BANGKOK, NNA – New vehicle sales in Thailand posted the first year-on-year decline in 30 months in June amid central bank efforts to curb car loans after last year’s spurt pushed up household debt.

The Federation of Thai Industries released the latest monthly data on Thursday.

Key points:

―― New vehicle sales fell 2.1 percent to 86,048, partly a reflection of the fact sales were so strong a year earlier. The decrease followed a 3.7 percent increase in May.

―― “Finance for car purchases is tougher, with very high rejection rates, particularly for smaller cars,” Surapong Paisitpattanapong, spokesman for the FTI's automotive industry division, told reporters, according to news reports.

―― Production of automobiles dropped 8.52 percent to 172, 878 for the second straight year-on-year decrease, marking the largest fall since April 2017, when output fell 12.9 percent. Output for domestic shipments posted the first decline in 30 months, while that for exports rose.

―― In the first half of 2019, vehicle production gained just 0.9 percent to 1.07 million units, with output for exports slumping.

Takeaway:

―― FTI’s Surapong said the industry group’s 2019 new vehicle sales growth target of 2.4 percent should still be achievable. In January-June, sales rose 7.1 percent from a year earlier, after a 19.5 percent jump for the whole of 2018.