Thailand Autos Report Q3 2011: New research report available at Fast Market Research

Fast Market Research recommends "Thailand Autos Report Q3 2011" from Business Monitor International, now available
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July 8, 2011 - PRLog -- New vehicles sales in Thailand showed significant growth over 2010, rising by 45.8% year-on-year (y-oy) to reach 800,357 units, according to figures released by the Thai Automotive Industry Association (TAIA). This sales performance reflected the strong recovery in consumer demand seen in Thailand across the course of the year, even against a backdrop of continued political strife. Breaking down the sales figures, a total of 362,561 passenger cars were sold in 2010 (up 51.8% y-o-y), alongside 40,479 vans (up 44.5% y-o-y), 23,049 buses (up 56.8% y-o-y), 351,566 pick-up trucks (up 40.3% y-o-y) and 22,702 trucks (up 64.6% y-o-y).

We believe the scene is set for continued growth in new car sales. We believe that overall expansion in the order of 10% is comfortably within reach in 2011. Consumers have benefited from good levels of economic growth, which has increased disposable income for new car purchases.

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The performance in the first three months of the year has generated upside risks to our 2011 sales forecast. In January, aggregate sales of new vehicles surged 38.0% y-o-y, to 68,398 units. In February, there was a 42.5% y-o-y rise, to 77,213 units, and in March sales rose 47.5%, to 93,008 units. For now, we stick with the forecast that we made last quarter for three main reasons. First, the percentage rises in sales during the first three months of the year were cushioned by strong base effects resulting from a relatively weak performance in Q110. Second, and more importantly, the Bank of Thailand is set on a course of monetary tightening. The central bank hiked the key one-day repo rate 0.25% to 2.75% in April 2011, the sixth time in the last seven meetings it has raised rates. The cumulative effect of these rises will crimp demand for big-ticket consumer items, at least to some extent, over the coming months. Finally, a lagged disruption to output in April, caused by the effects on the supply chain of a tsunami in Japan in March, is likely to impact negatively on the (as yet unpublished) production and sales figures for April.

Production Blip Overcome?

On May 12 2011, it was reported that Toyota Motors Thailand would return its three auto assembly factories in the country to full production levels by the earlier than previously anticipated date of May 23, following the disruption to components supply generated by the earthquake and tsunami in Japan in March. Production cuts had come into effect on April 25, thereby meaning that production was running at sub-optimum levels for a month. The company said that it had taken the opportunity to provide additional training for staff during the production slowdown.

We believe that output of vehicles in Thailand (inclusive of all producers operating in the country) is on course to expand 15% over 2011, before slowing down to an annual growth rate of around 8% over the remainder of our forecast period to 2015. This higher production will be primarily driven by strong levels of exports to the rest of the ASEAN region, with BMI believing that exports will continue to represent over half of total Thai production over our forecast period to 2015.

'Pick-up Tax' - Authorities Move to Reassure Producers

Manufacturers of pick-up trucks in Thailand were in March 2011 assured that their products will not be adversely affected by a proposed new tax structure, going some way to preserving the market's position as the leading ASEAN production base. The announcement came from the Excise Department.

A number of Japanese carmakers were opposed to the new tax structure, which they said would increase excise duty on pick-up trucks. However, the director-general of the Excise Department, Pongpanu Svetarunda, said it would not raise tax rates on the country's 'product champions', which are light pick-ups and the small fuel-efficient cars covered by the government's eco car project. Svetarunda also said that tax incentives would be awarded to vehicles with low carbon emissions or those with 'clean energy' engines. He added that the new tax structure would be implemented immediately after the finance ministry has issued the regulations, specifically because there will be such a small negative impact on the auto sector. About Business Monitor International

Business Monitor International (BMI) offers a comprehensive range of products and services designed to help senior executives, analysts and researchers assess and better manage operating risks, and exploit business opportunities, across 175 markets.  BMI offers three main areas of expertise: Country Risk BMI's country risk and macroeconomic forecast portfolio includes weekly financial market reports, monthly regional Monitors, and in-depth quarterly Business Forecast Reports.  Industry Analysis BMI covers a total of 17 industry verticals through a portfolio of services, including in-depth quarterly Country Forecast Reports.  View more research from Business Monitor International at

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Tags:Thai, Auto, Cbus, Vehicle, Backdrop, Violence, Autos, Running, Taia, Trucks
Industry:Transportation, Automotive, Shipping
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