Auto leasing firms take foot off the accelerator

[webfact]

Auto leasing firms take foot off the accelerator

By THE NATION

 

File photo of a motor show event in Bangkok

 

Auto leasing companies have lowered their annual targets but remain hopeful that the market will slowly recover in the second half of 2020 after the unlocking of the government shutdown order.

 

Pomphet Rasanon, deputy managing director of auto leasing business at Thanachart Bank, said that the overall automotive market in the second quarter is still declining continually from the first quarter. “The third and fourth quarters should see an improvement as the lockdown measures are gradually being lifted. However, we estimate that total loans for new cars will be significantly lower than that of last year.”

 

Pomphet added that the bank has rolled out several measures to help customers who have been affected with Covid-19. “We have provided up to six months of grace period for borrowers who applied for loans to buy either new or used cars, as well as those who mortgage their cars in exchange for cash,” he added. “More measures will follow when the grace period is over, depending on the market situation.”

 

Phomphet also added that this year Thanachart Bank had been successful in controlling the rate of non-performing loans (NPLs) to be lower than industrial standard. “We have used our own scoring model that can efficiently evaluate the risk of each borrowers, together with effective customer communication programme to reduce the mortgage delinquencies.”

 

Meanwhile, Krittiya Srisanit, chief auto leasing officer at Bank of Ayudhya, also known as Krungsri Auto, said that the bank has to lower its automotive loan target in the second quarter due to the impact of Covid-19 that started to escalate since March. “The outbreak has affected economic activities and household income, and will continually reduce the consumer confidence index through the year, urging the bank to reconsider its annual target,” she added.

 

“As the lockdown measures are being lifted and people start to earn money, the bank will be able to control the NPL at a suitable rate,” she said. “We expect that the business and manufacturing sectors, including SMEs [small and medium-sized enterprises] will resume their operations soon and more people will require funding to strengthen their business liquidity, whereas the bank’s ‘car for cash’ loan will be among the preferred choices to obtain cash at short notice.”

 

Krittiya also added that Krungsri Auto has provided assistance to over 500,000 Covid-19 affected customers in the last two months.

 

Source: https://www.nationthailand.com/news/30388164

 

-- © Copyright The Nation Thailand 2020-05-20

 

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[ThailandRyan]

Nothing in the article written speaks to an actual auto lease.  The OP title leaves one to believe that leasing companies in Thailand are lowering there targets for loans. "However, we estimate that total loans for new cars will be significantly lower than that of last year.”  To me, and maybe its because I come from the US, but a Lease is much like a long term rental where you put money up front and then let the car for a specific period of time before returning it.  What I am reading here is about Auto Leasing Loans, or NPL's, as well as mortgage delinquencies, and loans taken out against a car.  I never have heard of a Lease program with a car dealer or through a bank.  The only leases/long term rentals I have ever had in my years before I bought my vehicles outright, were paid directly to the rental company.

[mrmicbkktxl]

Actually we would like to buy a new car,had a look at Toyota,Honda and Nissan Websites,no Corona discounts or promotions.So I guess they still sell enough cars

[Cake Monster]

1 hour ago, ThailandRyan said:

Nothing in the article written speaks to an actual auto lease.  The OP title leaves one to believe that leasing companies in Thailand are lowering there targets for loans. "However, we estimate that total loans for new cars will be significantly lower than that of last year.”  To me, and maybe its because I come from the US, but a Lease is much like a long term rental where you put money up front and then let the car for a specific period of time before returning it.  What I am reading here is about Auto Leasing Loans, or NPL's, as well as mortgage delinquencies, and loans taken out against a car.  I never have heard of a Lease program with a car dealer or through a bank.  The only leases/long term rentals I have ever had in my years before I bought my vehicles outright, were paid directly to the rental company.

Thailand Ryan

A lease for a vehicle of any sort in the UK is exactly the same as you describe for the US.

The customer ( usually a business ) Places a deposit and then pays a Monthly fee for the use of the Vehicle over a determined period  of time.

During this period of time the lease Company services the Vehicle and repairs it. and I believe they also Tax the vehicle.

Business users like this option, as they have new style vehicles in their Fleet, have no service or repair issues Etc and the costs are Tax deductable.

I also am reading Loan Companies in the Article and not Lease Companies.