Thailand’s car production fell 13.62% in February, marking 19 straight months of decline

Thailand has introduced a 13.62% lower in automotive manufacturing in February in comparison with the identical month final yr, marking the nineteenth month in a row of decline.

Key Factors

• Automotive manufacturing in Thailand dropped by 13.62% in February from a yr earlier, marking the nineteenth consecutive month of decline, in line with the Federation of Thai Industries.
• Home automotive gross sales and exports additionally fell in February, influenced by components resembling tightened auto loans, excessive family debt, elevated competitors from Chinese language automotive manufacturers, and emission controls in some nations.
• Regardless of the continuing decline, the Federation of Thai Industries forecasts a 2% rise in automotive manufacturing this yr, following a 20% lower in 2024 that resulted within the lowest output in 4 years.

Thailand experiences a 13.62% drop in automotive manufacturing in Thailand in February in comparison with the earlier yr, marking the nineteenth consecutive month of decline. This lower, nevertheless, was much less extreme than January’s 24.63% year-on-year droop. The Federation of Thai Industries attributed this to a protracted decline in home gross sales and exports, with home automotive gross sales dropping by 6.68% and exports falling by 8.34%.

The excessive family debt in Thailand, equal to 89.0% of the GDP, has led to tightened auto loans, notably for pickup vehicles. The federation is carefully monitoring the U.S. coverage on auto tariffs, as introduced by U.S. President Donald Trump. Regardless of the decline, the federation forecasts a 2% rise in automotive manufacturing this yr.

In the meantime, home demand for automobiles stays subdued as a result of monetary pressure on households, prompting producers to give attention to export markets. The federation additionally highlights considerations over fluctuating uncooked materials prices, which may influence manufacturing effectivity. To counter these challenges, automakers are exploring methods to boost price administration and put money into electrical automobile (EV) manufacturing to align with world traits.

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Thailand Car Market Overview

Thailand is a cornerstone of Southeast Asia’s automotive business, typically dubbed the “Detroit of Asia” because of its standing because the area’s largest car manufacturing hub. Nevertheless, as of 2024 and early 2025, the market has confronted important challenges alongside pockets of development, notably within the electrical automobile (EV) section. Beneath is an summary primarily based on the most recent traits and knowledge as much as March 25, 2025.

Market Measurement and Gross sales Efficiency

• Whole Car Gross sales in 2024: Thailand recorded 572,675 new automobile gross sales, a 26.2% decline from 2023 (775,780 items), marking the bottom annual determine in 15 years since 2009 (Nikkei Asia). This downturn displays a broader financial slowdown and weakened client demand.
• EV Gross sales: Regardless of the general decline, EV gross sales confirmed resilience. Registrations for battery electrical automobiles (BEVs) grew 11.67% year-to-date by September 2024, although month-to-month figures softened, with a 25.81% drop in September alone (Thailand Enterprise Information). The Federation of Thai Industries (FTI) revised its 2024 EV gross sales estimate to 76,000 items, matching 2023 ranges, down from an earlier 100,000-unit projection (Nation Thailand).
• Market Penetration: EVs accounted for 15.4% of complete automobile gross sales in 2024 (Bangkok Publish), up from earlier years, pushed by authorities incentives and rising client curiosity.

Declining Manufacturing Developments

• Manufacturing Quantity: In 2023, Thailand produced 1.83 million automobiles (Statista), however 2024 noticed a pointy decline. By January 2025, manufacturing dropped 24.63% year-on-year to 107,103 items, marking the 18th consecutive month of decline (IndexBox). February 2025 continued this pattern with a 13.62% drop.
• Elements: Weak home gross sales, lowered exports (down 17.67% in September 2024 to 80,254 items), and competitors from imported Chinese language EVs have strained manufacturing (Thailand Enterprise Information). Excessive family debt and tighter auto mortgage situations additional exacerbated the droop.

Key Gamers and Market Share

• Conventional Leaders: Japanese manufacturers like Toyota (34.6% market share goal for 2024), Isuzu, and Honda have traditionally dominated, however confronted gross sales declines in 2024—Toyota down 17.4%, Isuzu down 48.3%, and Honda down 4.7% from January to April (Nation Thailand).
• EV Market: Chinese language automakers, notably BYD, have surged forward. BYD held a 32% EV market share in 2024 (estimated 28,238 items), whereas Tesla captured round 10% (roughly 9,000 items). Different Chinese language manufacturers like MG and NETA additionally gained traction, collectively holding 89% of EV gross sales from January to April 2024 (Auto Innovator).
• Notable Development: BYD’s gross sales rose 50.2% within the first 4 months of 2024, reflecting its sturdy foothold (Nation Thailand).

Authorities Insurance policies and Incentives

• Subsidies: The federal government lowered EV subsidies from 150,000 Baht per automobile in 2023 to 100,000 Baht in 2024, but continues to advertise EV adoption with a goal of 30% of automobiles produced being EVs by 2030 (Mobility Foresights).
• Mortgage Ensures: In March 2025, the federal government launched mortgage ensures for pickup vehicles, a vital section, to stimulate the flagging auto sector (Thai PBS World).
• Infrastructure: The Japanese Financial Hall (EEC) hosts new EV manufacturing vegetation, resembling BYD’s Rayong facility (opened July 2024, capability 150,000 items/yr), supporting native manufacturing (CNEV Publish).

Financial and Client Context

• Financial Challenges: Thailand’s GDP development was modest at 2.7-2.8% in 2024 (Thailand Enterprise Information), with excessive family debt (non-performing auto loans at 259.33 billion Baht by Q2 2024) and stricter lending standards curbing purchases (Nation Thailand).
• Client Preferences: Pickup vehicles stay dominant (e.g., Toyota Hilux, Isuzu D-Max), however EV adoption is rising, particularly amongst city shoppers, pushed by environmental consciousness and decrease working prices.

Aggressive Dynamics

• Chinese language Affect: Chinese language manufacturers are reshaping the market with reasonably priced EVs, difficult Japanese incumbents. BYD’s native manufacturing and pricing (e.g., Atto 3 at 1.099 million Baht vs. Tesla’s 1.7 million Baht beginning value) give it an edge (The Thaiger).
• Exports: Thailand stays an export hub, transport to 124 nations, although geopolitical tensions (e.g., Center East conflicts) disrupted routes in 2024, decreasing export volumes (Thailand Enterprise Information).

Outlook for 2025

• Projections: The FTI forecasts 2024 manufacturing at 1.9 million items (a 3.17% enhance from 2023), with home gross sales at 750,000 items (Nation Thailand). Nevertheless, ongoing declines in early 2025 recommend a possible downward revision in November 2025 discussions (Thailand Enterprise Information).
• Development Segments: EVs are anticipated to drive restoration, with VinFast (30% ASEAN EV share) and BYD increasing aggressively (Focus2Move). Hybrid gross sales may rise as electrification slows barely (MarketsandMarkets).
• Challenges: Excessive debt, competitors, and provide chain points (e.g., semiconductor shortages easing however persistent) will proceed to strain the market (Krungsri).