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Thailand’s Federation of Industrial Unions (FTI) has reported a decline in automotive production for the month of January, with an output of 107,103 units, representing a 24.63% decrease compared to the same period last year. This marks the 18th consecutive month of declining automotive production in the country.
Domestic vehicle sales in Thailand also witnessed a drop, reaching only 48,092 units, a 12.26% decrease year-over-year. This follows a significant decline of 20.94% in December 2024.
According to Reuters, Thai automotive exports in the first month of the year fared no better, plunging 28.13% to 62,321 units. This is the lowest level in 33 months.
“I am truly shocked by the extent of the decline,” said Surapong Paisitpattanapong, spokesperson for FTI’s automotive sector, at a press conference.
Thailand was once considered the largest automotive manufacturing hub in Southeast Asia, serving as an export base for major players such as Toyota, Honda, and Mitsubishi. At its peak in 2018, automotive production in the country surpassed 2.167 million units.
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Japanese auto manufacturers halt operations in Thailand. Image: AFP/Christophe Archambault |
However, fierce competition from affordable Chinese automotive models has exerted significant pressure on Thailand’s automotive industry. In response, several automakers have begun planning to scale back their production operations in Thailand, with some even opting to shut down their factories.
In late 2024, Suzuki announced the closure of its Thai factory, while Honda intends to cease operations at its plant in Ayutthaya. Subaru’s manufacturing plant also halted production at the end of 2024.
Thailand has been a preferred choice for many automakers establishing a production base in Southeast Asia. Back in 2018, renowned automotive manufacturers with a presence in the country included Ford, General Motors, BMW, Mitsubishi, Mazda, Toyota, Isuzu, Nissan, Honda, and Suzuki.
As the trend toward electric vehicles gained momentum in recent years, Thailand also attracted the attention of Chinese automotive manufacturers. BYD, Aion, Great Wall Motors, Neta, and Chery are among those that have already set up or are in the process of establishing manufacturing facilities in the country.
The influx of Chinese electric vehicle manufacturers has disrupted the balance of Thailand’s automotive industry and is believed to be the primary factor contributing to the consistent decline in production volumes.
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