The Federation of Thai Industries (FTI) has an optimistic outlook for the country's automotive industry but is concerned about a slight contraction in the local motorcycle market.
Surapong Paisitpatanapong, a spokesman for the FTI's automotive industry club, said the club has not announced a new projection for automotive output, sales and exports and is waiting to make a final decision on July 25.
He said the tentative projection for output is 2.1 million vehicles, up from the previous figure of 2 million.
Local sales are projected at 960,000-980,000 vehicles this year, up from 900,000 units earlier. Exports are projected at 1.12 million vehicles, up from 1.1 million.
"In the domestic market, we think launching new models can stimulate the market because retail prices below 800,000 baht per car are very attractive for motorists to buy new cars. But is still hard to forecast whether the market this half will remain bullish," Mr Surapong said. "The export outlook has performed better than expected as the country's main destination, the Middle East, has resumed economic growth on rising oil prices."
Yesterday the club reported that the country's car output in June increased by 7.7% to 188,970 units, driven by the production of pickups for international markets, which rose by 5.9% to 64,342 units last month.
The production of passenger cars and pickups for the domestic market in June increased by 18.5% and 21.8% to 46,221 and 44,097 vehicles, respectively.
The output from January to June stood at 1.057 million vehicles, up 11.1% year-on-year.
Local sales in June increased sharply by 25.9% to 87,854 units, which was up 3.4% month-on-month.
The club reported that many factors have accelerated the market, including government spending, private sector investment, new car models, growing consumer confidence, an uptick in the construction sector, a recovery in some farm prices, healthy imports and exports, poverty reduction measures and bullish tourism sentiment.
As a result of those factors, car sales from January to June totalled 489,118 units, good for 19.3% year-on-year growth.
Car exports in June increased by 2.4% to 95,284 units, while export value contracted 1% to 49.147 billion baht.
The club said many destinations registered growth in June, particularly the Middle East, but Oceania and European markets were in the red.
Car shipments over the first six months stood at 561,960 units, up 4.8%, with a total value of 290.892 billion baht, up 2.6%.
For the motorcycle industry, Mr Surapong said local sales contracted slightly during the first six months because the purchasing power of working-class people, the largest segment for such vehicles, was weak.
The registration report from the Land Transport Department said the market from January to June dropped by 1.6% to 934,747 motorcycles.
"Motorcycle buyers are completely different from car buyers, and many working-class people cannot afford to buy cheap eco-cars, explaining why the car market [which attracts another income segment] has grown while the motorcycle market has dropped," Mr Surapong said.
The club projects that the 2018 motorcycle market will be flat at 1.8 million units sold.
