Direction for Thai Auto Makers

Direction for Thai Auto Makers towards Sustainable Growth

Since the COVID-19 pandemic began in early 2020, many developments have taken place and the projection of automotive industry has become clearer for this year’s last quarter. One of the most knowledgeable professionals about the current situation is Mr. Pisit Rangsaritwutikul, President of Thailand Automotive Institute—an organization to help develop and promote Thai automotive entrepreneurs’ competitiveness.

“The supply and demand for Thai automotive industry have been greatly affected by COVID-19. The supply side was affected due to the shortage of manufacturing parts from overseas. Therefore, eight automotive manufacturers in Thailand had to halt their production lines during April-May 2020. Although Thailand has been able to control the spread of the disease, the social distancing measures have restricted the number of workforce and limited the production capacity from returning to the pre-Covid level.

The demand side has also been affected due to low economic activity. In April, Thailand’s automotive production hit the lowest point in 8 years, with an 84% decline and a 65% drop in domestic sales. However, the production output has been steadily on the rise since May although the total production in the first seven months is still 44% lower than the same period last year. The Federation of Thai Industries has forecast two scenarios that may follow the Covid-19 pandemic:

Scenario 1: if there is no second wave of the pandemic and the market can recover quickly, Thailand will be able to produce 1,400,000 cars this year with most of the output being distributed domestically.

Scenario 2: if there is a second wave of the pandemic, Thailand will be able to produce only 1,000,000 automotive units, where half of the production will be for domestic sales and the other half for export.”

Regarding the up-and-coming electric vehicle, Khun Pisit explained that “We currently have 14 auto makers, with 23 xEV projects approved for investment, including 5 HEV projects, 6 PHEV production projects, and 12 BEVs. All of these combined have resulted in newly registered 27,171 xEV in 2019 which is a 34% increase from 2018.”

On Challenges and Opportunities for Thai Automotive Industry

"Information technology and environmental awareness have contributed to the four trends of development in automotive industry. These trends include Electric vehicle (EV), Connected and Automated Vehicle (CAV), Shared Mobility and A-C-E-S Technology. They will increase the overall value of the automotive industry, and more electronics components and software will be used as well as electric powertrain. This is evident from the growth of electronics parts in the past five years. Due to the uncertainty of the current situation since the effective vaccine has not been discovered, manufacturers should prepare their existing facilities to be compatible with the new technologies, and look out for new requirements that will come with the New Normal such as hygienic maintenance in order not to be left behind in the ever-changing landscape of the automotive industry.

The Importance of Trade Fairs to Promote Manufacturers

Before the COVID-19 pandemic, trade exhibitions helped boost sales and served as the venue where industrialists could meet and interact with their colleagues. These activities helped facilitate business expansion, enhance networking and promote future collaboration. However, since meeting face-to-face has become difficult following the outbreak, trade exhibitions may need to change by adopting electronic platforms so their customers become familiar with the new format and can continue their commercial activities.”

IMPORTANT NOTE!

“Automotive Manufacturing” is open to trade visitors only. Please dress in business attire. Those wearing shorts and/or sandals and minors under the age of 15 will not be permitted into the exhibition hall. The organizer reserves the right to refuse admission to anyone without cause or explanation.