Economy Thai Auto Industry Faces 1.4m Output Slump Amid US Tariffs

[webfact]

File photo via Facebook Bangkok Post

 

Thailand's automobile production is expected to dip below 1.4 million units this year, primarily due to the ramifications of the United States' new tariff policies.

 

The Federation of Thai Industries (FTI) has announced plans to adjust its targets, previously set at 1.5 million units, as it evaluates the impact on car exports. This decline follows last year's shortfall where production reached only 1.46 million units against the same target.

 

In response to US President Donald Trump's implementation of a hefty 25% tariff on foreign-made automobiles effective from April 2, the sector anticipates turbulence.

 

These tariffs will soon be accompanied by heightened duties on auto parts, expected by May 3. FTI Vice-chairman Surapong Paisitpatanapong expressed concerns over these tariffs' challenge to the Thai automotive sector, emphasizing the uncertainty over the impending reciprocal tariff set for mid-year.

 

 

 

March figures indicate a 6% year-on-year reduction in Thailand's car production, down to 129,909 units. This decline is largely attributed to a 9.3% decrease in export production, driven by alterations in passenger car designs.

 

In contrast, the domestic market witnessed a slight uptick of 0.36% in production, bolstered by an increase in electric vehicle manufacturing.

 

Looking at the first quarter's statistics, overall car production fell by nearly 15%, registering 352,499 units. Domestic sales have been similarly constrained, impacted by high loan rejection rates and household debt, resulting in a marginal decline of 0.54% in March, with 55,798 units sold. Car sales for the quarter dropped by 6.45% to 153,193 units, further compounding the industry's struggles.

 

Furthermore, car exports plummeted by 14.9% in March to 80,914 units, with a first-quarter export decline of 18.6% year-on-year, totaling 220,139 units. The ongoing tariffs and declining exports underline significant hurdles for Thailand's automotive sector, as stakeholders continue to monitor the unfolding situation.

 

  Adapted by ASEAN Now from Bangkok Post 2025-04-30

 

 

[Wrwest]

From news this morn, appears trump has again backed down from his ill advised tariff aggression. the car industry, parts supply he cited as needing relief.

[newbee2022]

The bootlickers are queueing already I read in Truth Social.

[gravity101]

Strange article. I read nothing that says the cause will be because of US tariffs. Sounds like it was slowing already last year and tariffs are an excuse.

 

[Guderian]

It's easier for them to blame Trump's tariffs for the emasculation of the Thai car industry than to tell the truth and admit that it's mainly caused by all the cheap Chinese vehicles being dumped in Thailand. Big Don may be a bit testy, but he's nothing like as sensitive to criticism as Uncle Xi in Beijing.

[mfd101]

Wikipedia has an article - 'Automotive Industry in Thailand' - well worth reading as background up to 2023 for those interested.

[hotchilli]

1 hour ago, Guderian said:

It's easier for them to blame Trump's tariffs for the emasculation of the Thai car industry than to tell the truth and admit that it's mainly caused by all the cheap Chinese vehicles being dumped in Thailand. Big Don may be a bit testy, but he's nothing like as sensitive to criticism as Uncle Xi in Beijing.

Some Trump bashers will use any excuse to not except the truth...

[vinny41]

1 hour ago, Wrwest said:

From news this morn, appears trump has again backed down from his ill advised tariff aggression. the car industry, parts supply he cited as needing relief.

The tariffs for auto parts doesn't start until May 3rd

The relief that you mentioned I suspect doesn't apply to Thai auto industry unless they are planning to build cars in the USA

In a separate proclamation, Trump revised the 25% tariff policy on auto parts, due to begin on 3 May, allowing automakers who complete vehicle assembly in the US to claim an offset equivalent to 3.75% of the retail price in the first year, through to 30 April 2026. This relief will be reduced to 2.5% in the following year. 

https://www.euronews.com/business/2025/04/30/donald-trump-to-offer-automakers-some-relief-on-his-25-tariffs

Thai car exports to the USA were subject to 2.5% import tariffs in March now they are subject to 27.5% import tariffs

car imports into Thailand are subject to 80% tariffs plus excise duty and taxes totalling 200% to 328% of cost of vehicle

[Paul Henry]

The truth is Trump doesn't know what he is doing.He will keep changing his mind and backing down.He lost big time with both Canada and China. Never mind he will blame Biden.