Thailand’s May car output slides on slower global growth, poor crops

14, Jun. 2019

BANGKOK, NNA – Thailand’s vehicle production posted the first drop in eight months in May amid slowing global growth caused by the U.S.-China trade dispute and due to lower demand from drought-hit farmers, data from the Federation of Thai Industries released Thursday showed.

Key points:

―― Vehicle production fell 6.1 percent from year earlier to 181,338 units. Output for domestic sales dropped for the first time in about two years, down 3.8 percent to 86,862 units. The decline was partly due to demand prompted in the same period a year earlier by the introduction of many new models. Output for exports slumped 8.1 percent to 94,476 units.

―― Vehicle exports slipped 3.6 percent to 95,331 units in May, marking the second straight y/y drop, led by double-digit percentage declines in shipments to Oceania, Africa and Latin America. By contrast, exports to Europe, North America and the Middle East showed double-digit growth.

Takeaway:

―― For the July-September outlook, Surapong Paisitpattanapong, FTI vice president, told reporters that the focus is on how flooding during the rainy season will affect prices of crops, and thus farmers’ incomes. He urged the incoming government to take action to support farm produce prices.

―― Surapong said the industry is keeping its forecast that vehicle production will total 2.15 million units for this year, barring huge shocks to the economy. Production for the first five months rose 2.9 percent on year to 893,067 units.