Brand New Car - No Money For Petrol

[homeownership]

A Thai friend of mine has told me of a government scheme where you get some tax back, if you buy a car. I dont know or care about the details, but what I found funny, is he has a Honda Civic as genuinly has no money to put petrol in it.

[Tonto21]

I'm sure someone will correct me if I'm wrong............

My understanding this government, 'Thairakthai', (Thai-Love-Thai) made an election promise. If they get into power they will see to it that everyone will get two keys....A key to a house and car.

The government will help each Thai citizen get cheap housing, (government employees first) and money back on a new car......10000 Baht back, I think in tax rebates.

I think the housing promise is a great idea, (still to see how this goes) but, the car thing, a lot of Thai's can't afford to buy and maintain a 'Click' let alone a 1000,000 Bath car. I wonder where the government cash back will end up?

Time soon to take advantage of the Hi-So car repossessions........And check-out the car auctions.

Edited June 8, 2013 by Tonto21

[NeverSure]

I don't think either idea is good. Running people into debt can't be good. I know a school teacher with a master's degree in Isaan who is some kind of curriculum manager. She makes 30k pm. She has a new house and a new pickup. She helps her parents some. She can barely afford to live. She doesn't know what the interest rates are on either the new home scheme or the new car scheme. This sounds more like welfare for the bankers to me.

I get a lot of posts deleted because "this topic isn't about the US," but I'll mention it and see what happens. Bill Clinton signed a bill in the late 90's that essentially said that everyone should be able to buy a new home. Financing was put in place to assure it. IMHO that was the beginning of the bundling of sub prime mortgages and the beginning of the whole real estate run up and crash. Easy financing for people who didn't qualify by traditional standards.

Someone above mentioned checking out the car auctions. I think that soon you can also check out the foreclosed homes.

From my observations Thais are going into debt for cars, homes, cell phones, TV's and credit cards and they have no experience in handling money. I see trouble. I hope the best for them.

[lomatopo]

Did your friend offer any rationale as to why he purchased an automobile? I'm guessing it is financed? And his monthly cash flow is enough to cover the fixed costs but not any operating costs?

Assuming he purchased during the fixed period, and the Honda was manufactured here - many were not as a result of the flooding which shuttered the Honda plant - then he might be eligible for up to a 100,000 baht rebate ~ one year after purchase. Economic stimulus of this type generally work out for the positive, but I understand many find subsidies, rebates, debt, government programs abhorrent.

[simple1]

Personal loans without repayment for more than three months rose 20.5 percent to 56.6 billion baht, or 22.3 percent of total bad debt in the fourth quarter, according to central bank data.

http://www.bloomberg.com/news/2013-04-01/five-car-families-seen-deterring-thai-rate-cuts-southeast-asia.html

[lomatopo]

So banks are loaning money to un-qualified borrowers? Is that the main take-away?

I measure car loan defaults very un-scientifically. There is a very large auction lot I pass every day. ~ Five years ago it was filling up every 30 days, with a resulting auction in about the same time period. Now the lot takes six months to fill up. Like I said, potentially un-representative of the real situation.

[arthurwait]

Not surprised considering how people in new cars seem afraid of the accelerator.

Anyway get people into debt and pick up cheap property. Simples innit.

Now if there's something like a flood that scares people into buying that cheap property that no one wanted before. Even better.

Edited June 8, 2013 by arthurwait

[innerspace]

The car scheme ran and ended at the end of last year.

No special finance deals or allowances.

Qualifying cars were eligible for a refund of the duty up to a maximum of 100,000B payable a year after purchase.

Cars up to 1.5L and trucks under 1M baht only so believe that excludes a civic.

Downside is not allowed to sell the car for 4 or was it 5 years...otherwise have to repay the duty.

Unable to make finance payments and unable to sell...that will cause repossetions!

People have already received the rebates so for once a genuine scheme.

[pattayadingo]

The irony of the OP's post is that his friend has a shiny new car that he can show off to people who come and visit but he cannot afford the petrol to take it out and about to show it off.....

Maybe in 5 or 10 years when he has paid for the motor, he can afford the petrol and take it out to show it off, but then it is an old banger......

[WonnabeBiker]

Hear, hear. There was a situation that a self-employed husband needed to go from Udon Thani to Bangkok.

He took his truck! At what cost? I reckon over 10,000 Baht. The VIP bus would have been 1,050 B return,

with food and drink and a nice reclining chair. 450 B for taxi rides. But hey, the guy wants to be seen with his ride.

The 10 grand he wasted will be sorely missed as his business is pretty bad.

How come that so many are going down in flames, wasting serious cash on I-phones and I-pads and needless junk?!?

[thequietman]

The irony of the OP's post is that his friend has a shiny new car that he can show off to people who come and visit but he cannot afford the petrol to take it out and about to show it off.....

Maybe in 5 or 10 years when he has paid for the motor, he can afford the petrol and take it out to show it off, but then it is an old banger......

The latest fad in my village is a ................. wall and gate.

Every house seems to need one or want one. You have the fanciest walls around the front and halfway down the side with a cracker of a gate.

My wifes cousin borrowed 60,000 baht for such a wall and gate. Its a face thing for sure as the wall clearly isnt for security or as a boundary. You just walk around the side about 5 metres and walk into the property.

You should see the house, if you could call it that. Its wooden, with the wood nailed as best they could. No cooker, no shower, no inside toilet, no windows just tin but its a great looking wall and gate. Houses everywhere are doing it.

The house is a mess but they choose to spend money on the wall instead. S@@t for brains springs to mind.

Same thing happens for trucks. Guy in next village bought new nissan pickup but can't drive it as he hasn't the money for diesel.

[overherebc]

Tom Jones sang about.

It's not unusual.

[Payboy]

Don't think Honda Civic qualified for the tax rebate scheme.

[overherebc]

The irony of the OP's post is that his friend has a shiny new car that he can show off to people who come and visit but he cannot afford the petrol to take it out and about to show it off.....

Maybe in 5 or 10 years when he has paid for the motor, he can afford the petrol and take it out to show it off, but then it is an old banger......

The latest fad in my village is a ................. wall and gate.

Every house seems to need one or want one. You have the fanciest walls around the front and halfway down the side with a cracker of a gate.

My wifes cousin borrowed 60,000 baht for such a wall and gate. Its a face thing for sure as the wall clearly isnt for security or as a boundary. You just walk around the side about 5 metres and walk into the property.

You should see the house, if you could call it that. Its wooden, with the wood nailed as best they could. No cooker, no shower, no inside toilet, no windows just tin but its a great looking wall and gate. Houses everywhere are doing it.

The house is a mess but they choose to spend money on the wall instead. S@@t for brains springs to mind.

Same thing happens for trucks. Guy in next village bought new nissan pickup but can't drive it as he hasn't the money for diesel.

Forgot to ask in last post, . Do they padlock the gate at night ?

[Tywais]

Don't think Honda Civic qualified for the tax rebate scheme.

"According to the scheme, car buyers eligible for tax refunds must be at least 21 years old. They must hold ownership of the cars for at least five years. Their vehicles must not be worth more than one million baht, with engine capacity not exceeding 1,500 cc." Source

All civics are at least 1800 cc.

[Donnie Brasco]

Personal loans without repayment for more than three months rose 20.5 percent to 56.6 billion baht, or 22.3 percent of total bad debt in the fourth quarter, according to central bank data.

http://www.bloomberg.com/news/2013-04-01/five-car-families-seen-deterring-thai-rate-cuts-southeast-asia.html

In keeping with the GLOBALIST agenda that has been imposed on this government, Thailand's poo dii have signed off on a

2,000,000,000,000 (that's two trillion) baht loan from the IMF.

It's costing less than .01% of that amount per year to support this.

This loan and similar populist policies buy, the popular vote.

Don't worry align out assigning blame here, Funseekers.

This is global banking working its magic.

Both gangs of these small-timers were up for it.

Y'all ready for what happens next ;-?

(Yeah, uhuh, didn't think so)

[jbrain]

Don't think Honda Civic qualified for the tax rebate scheme.

"According to the scheme, car buyers eligible for tax refunds must be at least 21 years old. They must hold ownership of the cars for at least five years. Their vehicles must not be worth more than one million baht, with engine capacity not exceeding 1,500 cc." Source

All civics are at least 1800 cc.

So in other words, the OP has no credibility at all and is just someone with too much time on his hands who thought, let's just make up something so we can bash some Thais.

[theblether]

Don't think Honda Civic qualified for the tax rebate scheme.

"According to the scheme, car buyers eligible for tax refunds must be at least 21 years old. They must hold ownership of the cars for at least five years. Their vehicles must not be worth more than one million baht, with engine capacity not exceeding 1,500 cc." Source

All civics are at least 1800 cc.

So in other words, the OP has no credibility at all and is just someone with too much time on his hands who thought, let's just make up something so we can bash some Thais.

Maybe his specific example is wrong but there are plenty of examples of unbelievable financial fecklessness around.

[lomatopo]

Believe there were some specific Honda models which were eligible: Brio, City, Jazz.

For some reason I equate a City to a Civic, but that's just a random impression, maybe based more on models I've seen in the U.S.?

Y'all ready for what happens next ;-?

Can you enlighten us?

Edited June 8, 2013 by lomatopo

[Bagwan]

Personal loans without repayment for more than three months rose 20.5 percent to 56.6 billion baht, or 22.3 percent of total bad debt in the fourth quarter, according to central bank data.

http://www.bloomberg.com/news/2013-04-01/five-car-families-seen-deterring-thai-rate-cuts-southeast-asia.html

In keeping with the GLOBALIST agenda that has been imposed on this government, Thailand's poo dii have signed off on a

2,000,000,000,000 (that's two trillion) baht loan from the IMF.

It's costing less than .01% of that amount per year to support this.

This loan and similar populist policies buy, the popular vote.

Don't worry align out assigning blame here, Funseekers.

This is global banking working its magic.

Both gangs of these small-timers were up for it.

Y'all ready for what happens next ;-?

(Yeah, uhuh, didn't think so)

Does this make the IMF Thaksin or Yingluck's father?

[simple1]

Personal loans without repayment for more than three months rose 20.5 percent to 56.6 billion baht, or 22.3 percent of total bad debt in the fourth quarter, according to central bank data.

http://www.bloomberg.com/news/2013-04-01/five-car-families-seen-deterring-thai-rate-cuts-southeast-asia.html

In keeping with the GLOBALIST agenda that has been imposed on this government, Thailand's poo dii have signed off on a

2,000,000,000,000 (that's two trillion) baht loan from the IMF.

It's costing less than .01% of that amount per year to support this.

This loan and similar populist policies buy, the popular vote.

Don't worry align out assigning blame here, Funseekers.

This is global banking working its magic.

Both gangs of these small-timers were up for it.

Y'all ready for what happens next ;-?

(Yeah, uhuh, didn't think so)

Don't know where you got your numbers or have I misunderstood your post? The pull down of the monies will not finalise until 2020 and planned for the first 10 billion to be used in the first year of the loan agreement. It is claimed the 2.2 trillion baht loan over 50 years will incur total interest of 3 trillion baht. It will require the government to allocate a budget equivalent to two - three per cent of the two-trillion baht loan to service it every year. Amortisation of the loan principal would not start until the 11th year.

[givenall]

I am sure he also has payment to pay, so will the car be reposed soon

Sent from my ST18a using Thaivisa Connect Thailand mobile app

[frankold]

The new car scheme repossessions will go into overdrive soon enough. Once the tax has been given back and spent or used to pay off money borrowed for the first 12 months payments. It should only damage the sub 1500cc >1mil segment of the market tho.

Somone I know got 8500 per month finance with a reported salary of 12000. They live in rented accommodation too. It took the bank all of 48hrs to approve.

[jbrain]

The new car scheme repossessions will go into overdrive soon enough. Once the tax has been given back and spent or used to pay off money borrowed for the first 12 months payments. It should only damage the sub 1500cc >1mil segment of the market tho.

Somone I know got 8500 per month finance with a reported salary of 12000. They live in rented accommodation too. It took the bank all of 48hrs to approve.

How about me ?

I got a 11.300 Baht finance and I have NO income, and the Thai lady who signed guarantee has also NO income ( never had ) and has a finance on a car as well.

[NeverSure]

The car scheme ran and ended at the end of last year.

No special finance deals or allowances.

Qualifying cars were eligible for a refund of the duty up to a maximum of 100,000B payable a year after purchase.

Cars up to 1.5L and trucks under 1M baht only so believe that excludes a civic.

Downside is not allowed to sell the car for 4 or was it 5 years...otherwise have to repay the duty.

Unable to make finance payments and unable to sell...that will cause repossetions!

People have already received the rebates so for once a genuine scheme.

To do what? Enrich the bankers and the car manufacturers and put the people into debt? Not only that, but when you sell a shoot load of cars in short order on a scheme, you borrow those sales from future years. Once too many people have a new car of a similar year model, they won't be in the market again for another 5 years, creating a drought in sales for future years.

I can't see a single upside to the scheme.

Edited June 8, 2013 by NeverSure

[mrtoad]

Seems the OP might not always be too accurate with the facts. I have visions of a bridge.

[anon210]

Would this not be meet appropriate in the motoring section?

Sent from my GT-N7000 using Thaivisa Connect Thailand mobile app

[frankold]

The new car scheme repossessions will go into overdrive soon enough. Once the tax has been given back and spent or used to pay off money borrowed for the first 12 months payments. It should only damage the sub 1500cc >1mil segment of the market tho.

Somone I know got 8500 per month finance with a reported salary of 12000. They live in rented accommodation too. It took the bank all of 48hrs to approve.

 

How about me ?

 

I got a 11.300 Baht finance and I have NO income, and the Thai lady who signed guarantee has also NO income ( never had ) and has a finance on a car as well.

Right. So ya both paying the loans off with fresh air then.

Sent from my GT-I9300 using Thaivisa Connect Thailand mobile app

[Chittychangchang]

At the end of the day when Thailand has gone into recession the same as the west then maybe Thailand will once again become a pensioners paradise.

[lomatopo]

I can't see a single upside to the scheme.

It is very easy to always be negative, and assume the worst. I think many here fall into this state as a result of aging, anxiety, depression, alcohol abuse, fear, being in a country which is different, possibly with few friends and a SO with whom one has little in common. I would encourage you to attempt to look for at least one positive thing, at least once a day. I think you will feel better.

Obviously these automobiles were already manufactured, in Thailand using local labor, and were available for sale/delivery. Manufacturers along with the distribution chain, willingly participated in this program, perhaps knowing that a tiny fraction of future sales might be pulled forward.

Encouraging people to purchase smaller, fuel-efficient, cleaner-running automobiles seems like one upside? Or replacing/complement an aging pick-up to increase one's business opportunities may be another?

All of the people I know who took advantage of this program - and it is only four in total - all live far, far away from Bangkok, and all paid cash.

Face it, ownership of an automobile is a very desirable goal here. The mobility, freedom, access to more/different employment and educational opportunities, the ability to expand a business or create a second/new business all can increase productivity and generally make people happier.

I guess if there are a lot of loan defaults and repos that means that financial institutions were making loans they shouldn't have been making? Seems simple enough to me, and the only potential negative to this program.

I suspect people have been getting into debt for a couple of hundred years, here in Thailand, and elsewhere.

Edited June 9, 2013 by lomatopo