Auto production in the first eight months of 2020 plunged 42% year-on-year to 812,721 units, but automakers still have four months to hit the 1.4 million unit target, according to the Federation of Industries. Thai (FTI).
The goal is achievable if 150,000 units are produced each month until the end of the year, the federation said. Half of the 1.4 million units will be exported.
“The FTI has a positive outlook for the auto industry, which is expected to recover over the past four months,” said Surapong Paisitpatanapong, FTI vice president and spokesperson for the group’s automobile club, on Thursday.
Expectations follow good signs for auto production in August, with monthly volume up 31.2% from July to 117,253 units, although the figure is down 29.5% year-on-year. the other.
In the same month, domestic car sales fell 12.1 percent year-on-year to 68,883 units, but rose 16 percent from July, due to the phasing out of lockdowns that prompted many temporary business closures earlier this year and canceled car shows like the Bangkok International Auto Show.
From January to August, domestic car sales fell 32.9% year-on-year to 448,006 units.
According to the FTI, auto exports in August fell 29.6% year-on-year to 57,402 units, as overseas auto activity remained sluggish. Compared to the July figure, however, shipments were up 15.8%.
From January to August, Thailand exported 457,516 cars, down 36.7% year-on-year. The value of exports stood at 251 billion baht, down 32.2% year-on-year.
FTI Chairman Supant Mongkolsuthree said the Thai Industrial Sentiment Index (TISI) in August recorded a fourth consecutive monthly increase to 84.0 points, from 82.5 in July.
Factors behind the index’s steady rise include business confidence in government control over the Covid-19 epidemic and growing demand in certain industries including automotive, food, household appliances and construction.
The August TISI was based on a survey of 1,215 companies in 45 industries. Most of them (69.2%) expressed their unease with the global economic situation. Some 54% of those polled were concerned about internal political conflicts.
The FTI continues to come up with plans to help restore the economy. The group is in talks with large companies on a proposal to increase liquidity for SMEs by reducing the term of credit from 60-120 days to 30 days.
“This measure will speed up debt repayment,” Supant said. “Payments for government projects must be settled within 30 days of procurement.”