Thailand’s July Auto Production Falls, Domestic Sales Rise

According to foreign media reports, on August 25, the Federation of Thai Industries stated that due to tariff uncertainties affecting export demand, Thailand's car production in July decreased by 11.39% compared to the same period last year, amounting to 110,616 vehicles. This marks the first decline in Thailand's car production in three months. However, driven by strong growth in electric vehicle sales, Thailand's car sales in July continued the recent growth trend.

Surapong Paisitpattanapong, spokesperson for the Automotive Industry Department of the Federation of Thai Industries, stated at a press conference that due to the uncertainty of U.S. tariffs, Thailand's automobile exports in July contracted by 13.27% year-on-year.

Image source: BYD Thailand Company

However, domestic car sales in Thailand have maintained growth for four consecutive months, with a year-on-year increase of 5.84% in July. Surapong stated that despite the persistent constraint on pickup truck sales due to tight credit during the economic downturn, the 35% surge in electric vehicle sales in Thailand has effectively driven the overall market recovery. He also added that car sales in Thailand this year are likely to reach 600,000 units.

As the second-largest economy in Southeast Asia, Thailand has long been a regional hub for automotive production and exports for major manufacturers such as Toyota and Honda. In the emerging electric vehicle sector in Thailand, Chinese car brands dominate, holding a combined market share of over 70%. Toyota recently announced that it will launch its lowest-priced hybrid model in Thailand and restart sales of an electric vehicle model to respond to the competitive pressure brought by the rise of Chinese electric vehicle manufacturers.

At the end of July, Thailand also adjusted its electric vehicle incentive policies to provide automakers with greater flexibility in meeting production requirements and promoting exports. Currently, as Chinese car brands are entering the local market one after another, the competition in Thailand's domestic electric vehicle market is becoming increasingly intense.

Thailand's electric vehicle policy introduced in 2022, which includes tax exemptions and price subsidies, has attracted over $4 billion in investment, with investors including Chinese companies BYD Auto and Great Wall Motors.

In the first half of this year, Chinese car companies also performed remarkably well in the Thai automobile market. The combined market share of major Chinese automakers in Thailand has reached 16%. Among them, BYD holds an 8% market share, SAIC Motor’s MG brand holds 4%, and Great Wall Motors holds 2%.