Thailand is one of the major players in the world’s automotive industry. It is the 13th largest exporter for automotive parts in the world, with shipping to over 100 countries.
Thailand is ranked 6th largest commercial vehicle manufacturer and is the largest in the Southeast Asia region. Here, we will tell you about market research Thailand of the country’s automotive market.
Overview of the Automotive Market
Founded in the 1950s, the Thai automotive industry has been growing steadily and rapidly. In just six decades, Thailand has turned from a country that assembles automotive components to a country with not just top automotive manufacturing but also export hub as well.
In 2019, the local sales reached 1.01 million units while export sales reached 1.05 million units.
At the moment, the Thai automotive industry has the followings:
- 23 automotive assembly plants
- Eight motorcycle plants
- 386 tier-one automotive parts makers
- 1,700 tier-two and tier-three automotive parts makers
which makes it the largest automotive manufacturer in the Southeast Asia region. The industry contributes around 10% of the country’s GDP and employs 850,000 people, most of whom are Thais.
Some export destination countries have cut purchase orders, leading to a decrease in car production. There is also the appreciation of Baht, resulting in a decreased value of car export.
This made some car manufacturers relocate their bases of production to avoid the strong currency. In 2019, Thai car exports were at 1.05 million units, 7.59% lower than last year.
The local sales also suffer from the decreasing purchasing power of farmers due to drought and the decline of visitors in the tourism sector.
The local sales are at 1.01 million units, 3.3% lower than last year. This contraction of the automotive market is the first one in three years.
The current trend in the Thai automotive market is the increasing sales of electric vehicles. In 2019, the growth of electric vehicle sales was estimated to be 76% – 83%, despite the contraction in the automotive market.
This domestic trend is in line with the global push towards less-emission, more environment-friendly vehicles, slowly phasing out gasoline- and diesel-powered vehicles.
Marketresearchthailand.com as Thailand Automotive Industry Consulting has shown that the Thai automotive market is contracting. This contraction, however, happens globally, not just in Thailand.
Thailand’s government has an economic stimulus that lasts for the entire year, thus minimizing the effect of the contraction. Due to the economic stimulus, slowing down the automotive market is unlikely to turn into a crisis.
Although the general automotive market in Thailand is contracting, the electric vehicles keep growing.
This trend is unlikely to stop as the Thai government provides incentives not just for electric vehicles production but also incentives in the form of reduced tax for vehicle owners.
The impressive growth of electric vehicle sales and government incentives provide the opportunity for businesses to benefit.
Thailand’s automotive market is growing steadily. There is a market contraction due to the current pandemic, but the market doesn’t suffer from a crisis due to government stimulus.
The trend in Thai automotive is changing with an increase in electric vehicles, according to marketresearchthailand.com. To benefit, businesses must be aware of these situations and adopt proper strategies.