The government approval of a 5-billion-baht fund to lift domestic pickup sales offers vehicle and auto parts makers some relief amid a stagnant market and stiff US auto tariffs, say local distributors.
Tri Petch Isuzu Sales, the local distributor of Isuzu vehicles, applauded the government's decision to set up the fund, in line with the Federation of Thai Industries' Automotive Industry Club.
Last month the cabinet resolved to approve the allocation of a 5-billion-baht fund to facilitate pickup loans for small and medium-sized enterprises (SMEs).
SMEs not only use pickups for transport, but also depend on the vehicles to earn a living.
"We are waiting to see how the fund will benefit the industry and its supply chain, especially auto parts makers," said Takashi Hata, president of Tri Petch Isuzu Sales.
Pickup assembly utilises 80-90% of all auto parts in the market, according to the club.
A plunge in pickup sales caused manufacturers to reduce pickup production by 200,000 units over the past two years, dealing a blow to auto parts makers, said the club's spokesman Surapong Paisitpatanapong.
In 2024, sales of pure pickups in the country fell by 38.3% year-on-year to 163,347 units. The vehicles gained the largest market share with 28.5% of total vehicle sales, followed by internal combustion engine-powered passenger cars (27%) and hybrid electric vehicles (20%).
The main reason for the decline in domestic car sales is strict lending criteria for prospective buyers based on the high level of Thai household debt.
Despite the Thai government scheme, the recent US tariff hike to 25% for foreign cars and auto parts exported to the US may hamper the auto parts sector.
Thailand-based manufacturers of passenger cars should not be affected because they do not ship this type of vehicle to the US, said Mr Hata. Isuzu, a major pickup maker, does not export vehicles from Thailand to the US.
"However, auto parts makers will be affected by the new tariff," he said.
The tariff for automakers took effect on April 3 and it will be applied to nearly 150 auto parts categories from May 3, according to media reports.
"It's difficult to predict the exact impact on the Thai automotive industry," said Mr Hata.
Isuzu, which has operated in Thailand for more than 60 years, previously announced a 32-billion-baht investment in the country between 2024 and 2028.
The company plans to produce electric pickups in Thailand starting this year for export to Europe, especially Norway, said Michimasa Kono, vice-president of Tri Petch Isuzu Sales.
