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In September, Thailand’s Manufacturing Production Index (MPI) decreased by 3.5% compared to the previous year, settling at 92.4 points. The Office of Industrial Economics (OIE) points to a slowdown in the automotive and construction industries as the main factors behind this drop. With the final quarter of the year underway, looming uncertainty about the upcoming US presidential election could pose additional hurdles.

 

During the third quarter, the MPI fell by 1.2% year-on-year, reaching 94.7 points, with a capacity utilization rate of 58.2%. Acting Director-General Passakorn Chairat of the OIE highlights that the September MPI decrease is related to a slowdown in the domestic economy, reduced consumer spending power, and high levels of household debt.

 

"Car production in Thailand continued to decline, marking the 14th consecutive month of reduction," Chairat noted. In September, production of pickups, small passenger cars, and hybrid vehicles over 1,800cc fell by 23.4% compared to the previous year. This decline is partly due to stricter bank criteria for auto loans over concerns of bad loans.

 

Similarly, the construction sector saw an 8.9% year-on-year drop in the production of concrete, cement, and plaster. This reflects a slowdown in both public and private construction projects, exacerbated by high household debt and increased prices for construction materials and housing.

 

In contrast, the OIE reported a surge in canned aquatic food production, which rose by 49.9% in September. This increase is driven by growing orders from the US, Canada, and Australia, in preparation for the year-end celebrations.

 

As the year end approaches, Thai businesses continue to tackle several issues including weak consumer purchasing power, signs of an economic slowdown in the US, and the upcoming American presidential election on November 5.

 

The election sees a tight race between Republican candidate and former president Donald Trump and Democratic candidate and Vice-President Kamala Harris. "The new US administration may impact companies in various ways. I recommend manufacturers adapt and manage their resources wisely," Chairat added.

 

He also encouraged factories to boost their use of clean energy, in support of global efforts to cut carbon emissions.

 

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-- 2024-10-31