Are new cars a luxury in Thailand?

[hellohello123]

Just curious, 

 

To be able to own say a brand new Toyota corolla or Honda City in bkk for example,

 

is it limited to the middle class and above, or can an average office worker work hard and get one without sacrificing 10 years salary?

 

for the record, back in my country, a Corolla would cost about six months salary after tax

 

so would someone with a new one of these be seen as highly successful?

 

I guess if a young girl had one of these they would also be asked questions

[bkkjames]

highly unlikely they would be seen as highly successful driving a corolla

 

 

 

[KhunBENQ]

 

can an average office worker work hard...

...
back in my country, a Corolla would cost about six months salary

Income:

Seven 11 about 9000 Baht/month.

Skilled factory labourer up to 20000.

Avarage office worker might earn up to 30000 (no managment position)

School director/high level government officer might make 60000.

(farang English teacher 25000 to 40000 and more )

 

A corolla type car in basic edition costs about 600000 Baht.

 

600000/9000: 67 months, out of reach

/20000: 30 months, very hard even with going deep into debt.

/30000: 20 months, still hard

/60000: 10 months, doable

 

So even the 30000 Baht middle class income has to struggle hard.

Different perspective if there is a couple with good double income.

 

There were some statistics recently about private debt of Thai families.

Thais are very high in debt.

Some low earners pay 40% of their income just for car dept.

 

Other way round: in Germany an avarage office worker could make 3500 EUR/month, about 150000 Baht/month.

If he would invest 20 months of income for the car, that would make up for 70000 EUR.

That would be much more than a Corolla

An the truth is: some do!

 

 

Edited August 4, 2014 by KhunBENQ

[up-country_sinclair]

Some days it seems like just about everyone in Thailand has a new car and new iPhone.  I can't imagine what their debt to income ratio is, but eventually it is going to end in tears.

[hellohello123]

 

 

can an average office worker work hard...

...
back in my country, a Corolla would cost about six months salary

Income:

Seven 11 about 9000 Baht/month.

Skilled factory labourer up to 20000.

Avarage office worker might earn up to 30000 (no managment position)

School director/high level government officer might make 60000.

(farang English teacher 25000 to 40000 and more )

 

A corolla type car in basic edition costs about 600000 Baht.

 

600000/9000: 67 months, out of reach

/20000: 30 months, very hard even with going deep into debt.

/30000: 20 months, still hard

/60000: 10 months, doable

 

So even the 30000 Baht middle class income has to struggle hard.

Different perspective if there is a couple with good double income.

 

There were some statistics recently about private debt of Thai families.

Thais are very high in debt.

Some low earners pay 40% of their income just for car dept.

 

 

 

Brilliant Answer, thank you!

[Spoonman]

can an average office worker work hard...
...
back in my country, a Corolla would cost about six months salary

Income:
Seven 11 about 9000 Baht/month.
Skilled factory labourer up to 20000.
Avarage office worker might earn up to 30000 (no managment position)
School director/high level government officer might make 60000.
(farang English teacher 25000 to 40000 and more )
 
A corolla type car in basic edition costs about 600000 Baht.
 
600000/9000: 67 months, out of reach
/20000: 30 months, very hard even with going deep into debt.
/30000: 20 months, still hard
/60000: 10 months, doable
 
So even the 30000 Baht middle class income has to struggle hard.
Different perspective if there is a couple with good double income.
 
There were some statistics recently about private debt of Thai families.
Thais are very high in debt.
Some low earners pay 40% of their income just for car dept.

I heard Thai's can get finance over 7 years so 600,000 - 120,000(20% deposit)= 480,000 financed/84 months = 5714 per month repayment.

[KhunBENQ]

Yes, private household debt ratio in Thailand is amongst the highest in the world.

 

I have added/edited my post in the meantime (comparison with Germany).

TV is so fast!

 

[culicine]

highly unlikely they would be seen as highly successful driving a corolla

 

 

 

It's all relative...perhaps to their poor issan neighbours a toyota / honda will bring a lot of face, but noone would notice in my village as that is the average car.

[KhunBENQ]

 

I heard Thai's can get finance over 7 years so 600,000 - 120,000(20% deposit)= 480,000 financed/84 months = 5714 per month repayment.

I think you overlooked a tiny detail named interest

 

And interest rates in Thailand are not fun stuff.

 

An example which I know from experience:

they buy a scooter in the 40000 Baht range with little deposit and finance for 4 years.

They end up paying more than 60000 Baht effectively.

Total interest over four years more than 50%.

So you can do a guess what seven year finance will end up.

 

 

[IMHO]

Anyone driving a "brand new" car is seen by others as being at least somewhat successful.

 

The main difference between TH and OS is that in the West used cars are dirt cheap, so everyone has a car.. and the distinction between street cred is: "used car", "new car" or "luxury/sports car".

 

In TH used cars are much more expensive comparatively, so the same sort of distinction is between "motorbike", "car", or "luxury/sports car", which if far more noticeable ;)

[Spoonman]

I heard Thai's can get finance over 7 years so 600,000 - 120,000(20% deposit)= 480,000 financed/84 months = 5714 per month repayment.

I think you overlooked a tiny detail named interest
 
And interest rates in Thailand are not fun stuff.
 
An example which I know from experience:
they buy a scooter in the 40000 Baht range with little deposit and finance for 4 years.
They end up paying more than 60000 Baht effectively.
Total interest over four years more than 50%.
So you can do a guess what seven year finance will end up.

Yep I did forget the interest. Most car interest seems to hover around the 2.4% mark (P.A) so over 7 years your repayments would = 6674 per month. Edited August 4, 2014 by Spoonman

[wowjudo]

doubt you will be seen as highly successfull with a corolla or city. These days you see only camry and mercedes benz driving around in bkk 

 

i've seen more luxurious german cars driving around than honda city last time i visited bkk

[Naam]

Yes, private household debt ratio in Thailand is amongst the highest in the world.

 

I have added/edited my post in the meantime (comparison with Germany).

TV is so fast!

 

you forget to edit the fairy tale salary of the "average office worker's" income €3,500 because that would imply a gross salary of nearly €5,000/month resulting to net 3.5k after income tax, social insurance and health insurance.

 

no average office worker makes €5k/month gross in Germany!

[DinoSabanovic]

 

 

I heard Thai's can get finance over 7 years so 600,000 - 120,000(20% deposit)= 480,000 financed/84 months = 5714 per month repayment.

I think you overlooked a tiny detail named interest

 

And interest rates in Thailand are not fun stuff.

 

An example which I know from experience:

they buy a scooter in the 40000 Baht range with little deposit and finance for 4 years.

They end up paying more than 60000 Baht effectively.

Total interest over four years more than 50%.

So you can do a guess what seven year finance will end up.

 

 

 

This is true. My sister in law bought new Honda Amize or what ever is called, with finance over 7 years. 
She have salary only 9000 thb. I was like "OMG"

but this is not the biggest problem. Problem is that house, if you can call that a house, is all broken and waiting new rain to destroy it completely. 

 

Edit: Forgot to add that she is about 5km from school where she working

Edited August 5, 2014 by DinoSabanovic

[Anders W Ferslev]

i just buy a new Toyota Avanza  (30% 189.000 bath down) and 14.650 bath a month for 3 years with 2.5% intrest. Car is in my name.

from K-Bank leasing 

[clockman]

The financial tsunami is coming one day, for sure.

[JacChang]

Honda city = University students, or new to the job office staff or bankers. No big deal, just like buying milk at makro.

 

Corolla = Entry-mid level managers. Again no big deal.

 

And yes, their debt is crazy. New car debt is accountable for most Thai's salary. I once fired a saleslady, after my acceptance of her job application, she immediately got a new Toyota vios red plated. All hi-so and stuff in "her society", didn't catch my interest at all. Upon been fired, she didn't complain about why, what, who.

 

"BUT, I buy new car, cannot get fired. Who pay?"

[Ace of Pop]

Is that Funny.?.

[ericthai]

can an average office worker work hard...
...
back in my country, a Corolla would cost about six months salary

Income:
Seven 11 about 9000 Baht/month.
Skilled factory labourer up to 20000.
Avarage office worker might earn up to 30000 (no managment position)
School director/high level government officer might make 60000.
(farang English teacher 25000 to 40000 and more )
 
A corolla type car in basic edition costs about 600000 Baht.
 
600000/9000: 67 months, out of reach
/20000: 30 months, very hard even with going deep into debt.
/30000: 20 months, still hard
/60000: 10 months, doable
 
So even the 30000 Baht middle class income has to struggle hard.
Different perspective if there is a couple with good double income.
 
There were some statistics recently about private debt of Thai families.
Thais are very high in debt.
Some low earners pay 40% of their income just for car dept.
 
Other way round: in Germany an avarage office worker could make 3500 EUR/month, about 150000 Baht/month.
If he would invest 20 months of income for the car, that would make up for 70000 EUR.
That would be much more than a Corolla
An the truth is: some do!

Who told you these figures? I think you are off. If you think Toyota is paying their factory workers 20,000B a month you are kidding yourself.
They make minimum wage. I pay my factory workers above minimum wages and they still only average about 8000B a month without overtime.
Office staff makes 10-12K per month. Accountant is getting 20,000B a month and I pay more than my Thai friends that own companies. My friend his wife was the assistant to the CEO of HUTCH, she speaks, Thai, English and French fluently and has a masters and she was only making 35K per month.
7-11 I'm sure is only paying minimum wage so 6 days a week is 7,200B a month. I own a company at this time but have worked in Thailand for 20 years and been in several management positions over the years never seen any office staff getting paid more than 15K per month in a non-management position.

[DinoSabanovic]

Honda city = University students, or new to the job office staff or bankers. No big deal, just like buying milk at makro.

 

Corolla = Entry-mid level managers. Again no big deal.

 

And yes, their debt is crazy. New car debt is accountable for most Thai's salary. I once fired a saleslady, after my acceptance of her job application, she immediately got a new Toyota vios red plated. All hi-so and stuff in "her society", didn't catch my interest at all. Upon been fired, she didn't complain about why, what, who.

 

"BUT, I buy new car, cannot get fired. Who pay?"

You said "not my problem" ?

Why not talk with her and explain some things in life?

[ericthai]

I heard Thai's can get finance over 7 years so 600,000 - 120,000(20% deposit)= 480,000 financed/84 months = 5714 per month repayment.

I think you overlooked a tiny detail named interest
 
And interest rates in Thailand are not fun stuff.
 
An example which I know from experience:
they buy a scooter in the 40000 Baht range with little deposit and finance for 4 years.
They end up paying more than 60000 Baht effectively.
Total interest over four years more than 50%.
So you can do a guess what seven year finance will end up.

All depends on the interest rate. If only 1-2% it can be done. Yes, they can finance for 7 years.

[JacChang]

 

Honda city = University students, or new to the job office staff or bankers. No big deal, just like buying milk at makro.

 

Corolla = Entry-mid level managers. Again no big deal.

 

And yes, their debt is crazy. New car debt is accountable for most Thai's salary. I once fired a saleslady, after my acceptance of her job application, she immediately got a new Toyota vios red plated. All hi-so and stuff in "her society", didn't catch my interest at all. Upon been fired, she didn't complain about why, what, who.

 

"BUT, I buy new car, cannot get fired. Who pay?"

You said "not my problem" ?

Why not talk with her and explain some things in life?

 

I asked her to leave the premises or she will be forced to by security.

 

I'm a boss, not a counselor.

Yea, I get your point, of her being the victim and all. But hear it out, the reason she was fired in a week's time was because she didn't incur any new sales. She goes out and at the end of the day reports in with nothing. I had to do research for her, "ok how about you go to this company at this address and have a talk with them." Nothing. On the 2nd week, she checks in during the office, as I require her to do so. Usually just 20-30 minutes. This time I had a longer chat with her. That's where I caught her. Someone kept ringing her phone number, she didn't answer politely, it's always like "ok, i'll be there soon" "call you later". No introduction nothing. Who? Bf? Oh I see, using my company time to have your dates while getting paid and a new car.

 

So Dino, should I have a "talk" with her, and straighten out her life and give advices?

You might, she's beautiful, young, white skin, model hair, skinny body with big firm assets.

[crazykopite]

 

 I heard Thai's can get finance over 7 years so 600,000 - 120,000(20% deposit)= 480,000 financed/84 months = 5714 per month repayment.

I think you overlooked a tiny detail named interest
 
And interest rates in Thailand are not fun stuff.
 
An example which I know from experience:
they buy a scooter in the 40000 Baht range with little deposit and finance for 4 years.
They end up paying more than 60000 Baht effectively.
Total interest over four years more than 50%.
So you can do a guess what seven year finance will end up.
 
 
 

This is true. My sister in law bought new Honda Amize or what ever is called, with finance over 7 years. 
She have salary only 9000 thb. I was like "OMG"
but this is not the biggest problem. Problem is that house, if you can call that a house, is all broken and waiting new rain to destroy it completely. 
 
Edit: Forgot to add that she is about 5km from school where she working

At least when the house is bar.omen she will be able to move into the comfy confines of her car !

[DinoSabanovic]

 

 

Honda city = University students, or new to the job office staff or bankers. No big deal, just like buying milk at makro.

 

Corolla = Entry-mid level managers. Again no big deal.

 

And yes, their debt is crazy. New car debt is accountable for most Thai's salary. I once fired a saleslady, after my acceptance of her job application, she immediately got a new Toyota vios red plated. All hi-so and stuff in "her society", didn't catch my interest at all. Upon been fired, she didn't complain about why, what, who.

 

"BUT, I buy new car, cannot get fired. Who pay?"

You said "not my problem" ?

Why not talk with her and explain some things in life?

 

I asked her to leave the premises or she will be forced to by security.

 

I'm a boss, not a counselor.

Yea, I get your point, of her being the victim and all. But hear it out, the reason she was fired in a week's time was because she didn't incur any new sales. She goes out and at the end of the day reports in with nothing. I had to do research for her, "ok how about you go to this company at this address and have a talk with them." Nothing. On the 2nd week, she checks in during the office, as I require her to do so. Usually just 20-30 minutes. This time I had a longer chat with her. That's where I caught her. Someone kept ringing her phone number, she didn't answer politely, it's always like "ok, i'll be there soon" "call you later". No introduction nothing. Who? Bf? Oh I see, using my company time to have your dates while getting paid and a new car.

 

So Dino, should I have a "talk" with her, and straighten out her life and give advices?

You might, she's beautiful, young, white skin, model hair, skinny body with big firm assets.

 

Sorry, I thought she got fired because of new car. That explain allot. I would fire her within first 5 days in case like this.

 

About meeting... no thanks, I'm happily married. Thanks for suggestion tho  :)  

[glasswort]

I guess if a young girl had one of these they would also be asked questions.

 

Why? 

[kuifje]

 

 

can an average office worker work hard...
...
back in my country, a Corolla would cost about six months salary

Income:
Seven 11 about 9000 Baht/month.
Skilled factory labourer up to 20000.
Avarage office worker might earn up to 30000 (no managment position)
School director/high level government officer might make 60000.
(farang English teacher 25000 to 40000 and more )
 
A corolla type car in basic edition costs about 600000 Baht.
 
600000/9000: 67 months, out of reach
/20000: 30 months, very hard even with going deep into debt.
/30000: 20 months, still hard
/60000: 10 months, doable
 
So even the 30000 Baht middle class income has to struggle hard.
Different perspective if there is a couple with good double income.
 
There were some statistics recently about private debt of Thai families.
Thais are very high in debt.
Some low earners pay 40% of their income just for car dept.
 
Other way round: in Germany an avarage office worker could make 3500 EUR/month, about 150000 Baht/month.
If he would invest 20 months of income for the car, that would make up for 70000 EUR.
That would be much more than a Corolla
An the truth is: some do!

 

Who told you these figures? I think you are off. If you think Toyota is paying their factory workers 20,000B a month you are kidding yourself.
They make minimum wage. I pay my factory workers above minimum wages and they still only average about 8000B a month without overtime.
Office staff makes 10-12K per month. Accountant is getting 20,000B a month and I pay more than my Thai friends that own companies. My friend his wife was the assistant to the CEO of HUTCH, she speaks, Thai, English and French fluently and has a masters and she was only making 35K per month.
7-11 I'm sure is only paying minimum wage so 6 days a week is 7,200B a month. I own a company at this time but have worked in Thailand for 20 years and been in several management positions over the years never seen any office staff getting paid more than 15K per month in a non-management position.

 

 

First poster salary's apply for Bangkok or Phuket.   The rest of the country mostly has lower salary's.   

Also take in account, that many people own (small) businesses and work (hard) long hours. 

The comparison between more advance economies and Thailand doen't make sence.  In Thailand households will feel a car is more important than the house or the room.  Many will spent much more money on there car, then for there house/room.    Family's will help pay for debts.   Many family's own land/houses, so they have back up in case its needed.   For sure the debt ratio is very high, and a high percentage will fail to repay all there debts, (maybe 10-15%), so that means most people will be ok with there debts.    

Really some comparison are just silly to make, different culture, different climate, different interests.

[crazykopite]

When I lived in Virginia in the 80s I would often drive past a tin shack which would have a beautiful Cadillac parked up outside in those days we could call this a status symbol. I can remember Koh Samui 10 years ago when there were a few cars and most people got around on an old motor scooter however these days have gone now you see the merc's , Bmw's range rovers, audi's and many more high priced cars and I often think how can Thais afford such vehicles the simple answer is that they have made huge amounts on land selling which they inherited from family. I see the debt in Thailand getting out of control people who live in tin sheds getting finance to buy a car over 120 months but after 6 months realise that they cannot make the payments on top of that there is the gambling culture no sooner have they got there wages and they are placing heavy bets on Football, cock fighting, bull fighting and the lottery sadly one day it I will end up in tears it is only a matter of time

[Krataiboy]

Some days it seems like just about everyone in Thailand has a new car and new iPhone.  I can't imagine what their debt to income ratio is, but eventually it is going to end in tears.

 

Thai household debts have increased to an average of 219,000 baht per household this year -  the highest level in nine years. Debt-to-GDP rose to 82.3% at end-2013, from 77.3% at end-2012,

 

Bubble bubble, toil and trouble. . . 

 

 

[lucifer666]

My ex was a hotel worker ( in the office) and she bought a brand new Honda and bought a new home. So i would guess yes.

[Ace of Pop]

Dino clearly isn't capable of vetting Staff, just good at playyng Mr Big , and posting someones fault here., your fired if you worked for me. Her Gain IMO.Crap Boss.