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Used car market in a jam as electric vehicles spark trouble
The used car market is in dire straits, with a shocking downturn blamed on the economic slump, soaring non-performing loans (NPLs), and the growing allure of electric vehicles (EVs), warns Tris Rating. In a jaw-dropping revelation, used car hire-purchase firms have reported a staggering 93% plunge in profits year-on-year for the first half of 2024. Motorcycle hire-purchase companies haven’t fared much better, with profits down by 71%, while truck hire-purchase firms saw a hefty 48% drop, according to a Tris Rating report. “The crux of the issue lies in skyrocketing financial costs and credit expenses, stemming from provisions for bad debts and losses on repossessed vehicles. This is all due to plummeting used car prices, particularly for trucks and cars.” Credit expenses have surged most dramatically in the used car sector, followed by trucks and motorcycles. In the first half of the year, the NPL ratio for truck hire-purchase loans is set to spike from 4.09% at the end of 2023 to 5% by the second quarter. Meanwhile, used car hire-purchase loans have seen their ratio climb from 5.82% to 6.07%. Interestingly, motorcycle hire-purchase loans have bucked the trend, with their NPL ratio dropping from 4.08% to 3.61%, thanks to increased write-offs leading to a lower loan loss provision ratio. Nevertheless, Tris warns, “the debt quality remains weak.” Rising credit costs from greater provisioning and write-offs raise red flags for many operators. The surge in EV popularity further exacerbates the situation, dampening sales of internal combustion engine (ICE) vehicles, slowing auto lending, and putting downward pressure on used car prices, said Tris Rating. Repossessed vehicles “The sluggish economy has resulted in a wave of bad debts and vehicle repossessions. Prices for used ICE cars have plummeted by over 20-30%, cutting collateral value and leading many companies to suffer losses from repossessions.” Truck hire-purchase loans are similarly beset by bad debts, with a surplus of repossessed vehicles driving used car prices even lower. “Tris Rating predicts that in the short to medium term, we won’t see many new players entering the market. This industry requires substantial capital, given the high cost of trucks and the need for a large portfolio to spread risk. Over the next year, the hire-purchase business will likely continue to decelerate, mirroring the sluggish economy and soaring household debt.” To weather these storms, operators must focus on maintaining credit quality. “Competition is expected to be moderate, mainly for quality customers, limiting the ability to increase yields and offset rising costs. Moreover, loan rejection rates will remain elevated.” Looking ahead, Tris Rating expects the sector to remain weak for the rest of 2024, hampered by economic uncertainty and a lack of government support. The drop in EV prices is also set to impact used car auction prices, further squeezing company performance in the coming months. “A more robust recovery in earnings is on the horizon for the second half of 2025, when government stimulus measures are anticipated to kick in and give the economy a much-needed boost.” by Bob Scott Bob Picture courtesy of Bangkok Post Source: The Thaiger -- 2024-09-30 -
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Where can one find proper Pipe Tobacco?
Yes Friendship supermarket had all sorts of smoking gear on the LHS display cabinets. I think the supermarket near the corner of Tepprasit and Tapraya rd also has smoking gear. -
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I Voted Today
Glad I read that right through to the last line......you had me worried for a moment. -
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Elderly Man Kills Wife’s Former Lover in Drunken Rage Over Advances
Once again, you think wrong and go on to pompously assume that you speak for everyone and know everyone's reasons for being in Thailand. -
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Destination Thailand Visa Sparks Interest, Faces Future Hurdles
Better option is to find another destination that will deal openly and honestly with you without all the BS and subterfuge. -
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Trump’s First Day Back: Key Priorities for a Second Term
If you are concerned why don't you start a Harris supporters thread? . Worried about Trump supporters response -
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Looking for 6/7 seaters car in thailand
please don't post misleading bullsh1t. The only way for me to avoid and escape your gutter language is....to block you. Good Bye. -
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Family Heartbroken as Teen Found Murdered After 5 Days Missing
I hope he gets his Just Deserts ... -
155
I Voted Today
Done and dusted. Downloaded and printed out the ballot, verification statement and envelopes (internal "Security envelope for the ballot to be sealed in), and then the outer mail envelope, signed across the back. As my state does not allow electronic voting, my ballot was placed in the vote box at the door of the US Consulate here in Chiang Mai. the ballots will be placed in the "Diplomatic Pouch" for direct delivery to the USA. From the USA port of entry, the "Franked" (no postage needed) ballots will move through the US Postal System for delivery to the local voting district. I will be informed by email when my Absentee mailed in ballot is received. Absolutely vote, our participatory democracy is facing a clear and present danger by Trump and his Project 2025 ilk. -
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Pick-up Truck Falls from Unfinished Bridge in Lat Krabang: Three Injured
The Thais seem to spend more money on safety signs than on safety....strange. -
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Trump’s First Day Back: Key Priorities for a Second Term
And the reason he is bashed daily is because the village idiot desevres it. The raping grifting,conman is pure evil and yet millions cannot see it. -
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