Thailand’s new vehicle market continued to decline in February 2025, with sales falling by 7% to 49,313 units from an already weak 52,843 units a year earlier, according to the latest wholesale data released by the Federation of Thai Industries (FTI).
Last month’s market decline, from very depressed year-earlier levels, followed a steeper 12% drop in January – prompting some market analysts to speculate that the downturn of the last two years may be close to bottoming out. Much of the decline has been blamed on stricter lending criteria introduced by banks and auto finance companies in response to rising levels of non-performing loans (NPLs), leaving the country’s highly indebted consumers and small businesses struggling to access financing. The auto loan rejection rate is reported to have reached 70% last year.
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Thailand is now South-east Asia’s third-largest vehicle market after Indonesia and Malaysia, with FTI data showing sales fell by 26% to 572,675 units last year from 775,780 in 2023 – the lowest level since 2009.
Vehicle sales in the first two months of 2025 fell by a further 10% to 97,395 units from 107,657 units in the same period of 2024, despite the latest government data showing economic growth in the country continued to accelerate in the fourth quarter of 2024, to 3.2% year-on-year from 3.0% in the third quarter and 2.0% in the first half of the year. Sales of pickup trucks are estimated to have fallen by 15% to 23,254 units year-to-date.
Thailand remains the ASEAN region’s largest vehicle producer, despite a 20% drop in output to 222,590 vehicles year-to-date, with production for export dropping by 16% to 153,579 units – reflecting increased competition in global markets from China-based automakers and also due to tougher emissions regulations in some key markets, according to FTI spokesperson Surapong Paisitpattanapong.
The Thai government announced earlier this month it will make available THB5bn for a loan guarantee programme to support the country’s struggling pickup segment. The programme is scheduled to run from the beginning of April until the end of the year and will offer loan guarantees for small and medium-sized businesses planning to purchase pickup trucks for business purposes.
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