Market Research Report
Research Report on Thailand's Automobile Industry, 2022-2031
|Research Report on Thailand's Automobile Industry, 2022-2031|
Published: July 25, 2022
China Research and Intelligence
Content info: 60 Pages
Delivery time: 1-2 business days
Thailand's automobile industry originated in the early 1970s. With its superior geographic location and government support, Thailand has become the largest automobile producer in Southeast Asia, and is called the Detroit of Asia. Automobile manufacturing has long been the pillar industry of the Thai economy. In 2021, the output value of automobile manufacturing accounted for more than 10% of Thailand's GDP.
From 2011 to 2012, the Thai government implemented the First-Time Buyer Program to encourage automobile consumption, which led to a rapid growth in automobile production and sales. However, the automobile production volume dropped by 25.77% in 2014 after the program expired. Despite a steady growth, it failed to recover to the 2.53 million units in 2013. The sales declined from 2013 to 2016, and rebounded to 873,000 units till 2017. In 2020, due to the impact of COVID-19, annual sales fell 21.4% to 792,146 units, and continued to fall to 762,217 units in 2021. Thailand's automotive industry is export-oriented. In the past five years, over 1 million automobiles were exported to ASEAN countries, Australia, the Middle East and Europe every year. The import volume is less. However, the import tariff on automobiles is expected to be lowered as Thailand signs more free trade agreements in recent years.
Over the years, the Thai government has introduced a series of policies to attract foreign investment. The automobile manufacturers in Thailand are mainly Japanese and US companies. The massive competitors and fierce competition make the market perfectly competitive. Compared with other Southeast Asian countries, Thailand has a developed auto parts industry and a large number of auto parts suppliers. However, it still needs to import key auto parts. There are many automobile brands in Thailand, including Toyota, Mitsubishi, Isuzu, Ford, BMW, Chevrolet, etc. which have produced a strong scale effect after years of development and production expansion. With the popularization of new energy vehicles, the Thai government also drew up a roadmap to give tax breaks and other preferential policies to new energy vehicle enterprises.
According to CRI, Thailand's automotive industry has a good prospect. Thailand's Eastern Economic Corridor initiative proposes to develop 10 target industries including the automotive industry in the eastern region. And the free trade agreements with Australia, China, India, New Zealand and other ASEAN countries will facilitate the development of overseas markets for Thailand's automotive industry. The reduction of import tariffs will also provide a price advantage for automobiles. New energy vehicles will grow rapidly in Thailand with the expiration of the lock-up period of the First-Time Buyer Program, more automobiles beyond the warranty period, and the government's efforts to develop new energy vehicles. It is expected that in the next few years, the increase in residents' income will promote automobile consumption in Thailand. And the exemption of import tariffs on automobiles in ASEAN countries will boost Thailand's automobile exports.
CRI expects that automobile production will continue to grow in Thailand from 2022 to 2031.