First car deal defaults jump 25 folds: Thai Excise Dept

[thailiketoo]

How could you possibly think your anecdotal evidence trumps hard facts. 500 people defaulted. Not some number you made up based on a few folks you know in Issan. If you want to make the case that you can't trust any numbers from the Thai or other governments OK but it's not accepted by the people who run the world (IMF, World bank, UN and so on). If you know more than all those people surly you could get a job as a top economist making millions a year.

Well to be fair a healthy amount of skepticism when looking at statistics is ok. I'm an economist and look at a lot of data every day, be it GDP growth data, CPI inflation and so on and sometimes it's worth wile to question whether what you see make sense. Let me give you an example. If a country has flat growth on electricity consumption and the government publishes more than 7% GDP growth, you have to be skeptical whether the government published data is accurate. I can give you many more examples.

Now in this case, I'm not saying 500 is wrong, but I am saying I'm skeptical whether this number is accurate on the basis that

a) say if 50% of the 1,000,000 (first time buyer scheme) took out a loan, the 500 defaults ytd would be 0.05% ytd and maybe about 0.1% on annualised.

looking at car auctions just in my province, the amount of reposessed cars being auctioned are a lot higher, just for 1 province. As I said, Chiang Mai alone is about 500 per month/6000 vehicles per year. Now this includes second hand and obviously cars not from this scheme.

Maybe I'm not reading this article correctly or I'm missing something else.

What you are missing is if they default the government gets the money back. So it is in the interest of the government to have you default. You default they get the incentive money back. What is the government incentive to understate the number? They have every reason to overstate it.

[alanrchase]

How could you possibly think your anecdotal evidence trumps hard facts. 500 people defaulted. Not some number you made up based on a few folks you know in Issan. If you want to make the case that you can't trust any numbers from the Thai or other governments OK but it's not accepted by the people who run the world (IMF, World bank, UN and so on). If you know more than all those people surly you could get a job as a top economist making millions a year.

Well to be fair a healthy amount of skepticism when looking at statistics is ok. I'm an economist and look at a lot of data every day, be it GDP growth data, CPI inflation and so on and sometimes it's worth wile to question whether what you see make sense. Let me give you an example. If a country has flat growth on electricity consumption and the government publishes more than 7% GDP growth, you have to be skeptical whether the government published data is accurate. I can give you many more examples.

Now in this case, I'm not saying 500 is wrong, but I am saying I'm skeptical whether this number is accurate on the basis that

a) say if 50% of the 1,000,000 (first time buyer scheme) took out a loan, the 500 defaults ytd would be 0.05% ytd and maybe about 0.1% on annualised.

looking at car auctions just in my province, the amount of reposessed cars being auctioned are a lot higher, just for 1 province. As I said, Chiang Mai alone is about 500 per month/6000 vehicles per year. Now this includes second hand and obviously cars not from this scheme.

Maybe I'm not reading this article correctly or I'm missing something else.

What you are missing is if they default the government gets the money back. So it is in the interest of the government to have you default. You default they get the incentive money back. What is the government incentive to understate the number? They have every reason to overstate it.

If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government?

[recycler]

The first car buyers programme was always going to end in disaster. There will be 50,000 - 100,000+ defaulters in this scheme

If only 500 defaulted it is a rousing success not a disaster. Better check your math.

Indeed, only 0.05% defaulted and over 1 million cars are sold. The only negative effects are that the prices on the 2nd hand market are down and after the promotion the car sales are lower than normal.

[thailiketoo]

What you are missing is if they default the government gets the money back. So it is in the interest of the government to have you default. You default they get the incentive money back. What is the government incentive to understate the number? They have every reason to overstate it.

If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government?

Sell property. Go to work in Pattaya. Stop drinking. Ask the Farang on the INTERNET. What difference does it make? It's after the fact of the discussion taking place here which is First Car Deals Default.

[alanrchase]

What you are missing is if they default the government gets the money back. So it is in the interest of the government to have you default. You default they get the incentive money back. What is the government incentive to understate the number? They have every reason to overstate it.

If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government?

Sell property. Go to work in Pattaya. Stop drinking. Ask the Farang on the INTERNET. What difference does it make? It's after the fact of the discussion taking place here which is First Car Deals Default.

Sorry mate, but you mentioned it. Did not realise questioning anything you put in your replies was out of order, please forgive my ignorance.

[recycler]

The first car buyers programme was always going to end in disaster. There will be 50,000 - 100,000+ defaulters in this scheme

If only 500 defaulted it is a rousing success not a disaster. Better check your math.

Indeed, only 0.05% defaulted and over 1 million cars are sold. The only negative effects are that the prices on the 2nd hand market are down and after the promotion the car sales are lower than normal.

[thailiketoo]

What you are missing is if they default the government gets the money back. So it is in the interest of the government to have you default. You default they get the incentive money back. What is the government incentive to understate the number? They have every reason to overstate it.

If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government?

Sell property. Go to work in Pattaya. Stop drinking. Ask the Farang on the INTERNET. What difference does it make? It's after the fact of the discussion taking place here which is First Car Deals Default.

Sorry mate, but you mentioned it. Did not realise questioning anything you put in your replies was out of order, please forgive my ignorance.

No I didn't. You wrote, "If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government"

I said, in this instance, it is in the government's interest to inflate the number not deflate the number. Since it is such a small number I think it is safe to assume it is real. Why would I care or how would I know how people are going to pay off a legal bill to the government? I have no idea how. Nor does anyone else. Why discuss it since no one knows the answer and it is off topic anyway?

[alanrchase]

What you are missing is if they default the government gets the money back. So it is in the interest of the government to have you default. You default they get the incentive money back. What is the government incentive to understate the number? They have every reason to overstate it.

If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government?

Sell property. Go to work in Pattaya. Stop drinking. Ask the Farang on the INTERNET. What difference does it make? It's after the fact of the discussion taking place here which is First Car Deals Default.

Sorry mate, but you mentioned it. Did not realise questioning anything you put in your replies was out of order, please forgive my ignorance.

No I didn't. You wrote, "If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government"

I said, in this instance, it is in the government's interest to inflate the number not deflate the number. Since it is such a small number I think it is safe to assume it is real. Why would I care or how would I know how people are going to pay off a legal bill to the government? I have no idea how. Nor does anyone else. Why discuss it since no one knows the answer and it is off topic anyway?

What you actually said is

"What you are missing is if they default the government gets the money back"

I just queried how. You made the statement.

[Pui]

that means it was a big succes if only 500 people do not meet payments....

they have sold hundred thousands of cars.

again big succes!

A success for who ?? the poor ?? government ??? thousands of cars on the market, could bring down second hand prices though.

you name it,

the poor,

the first car owners.

the manufactures of the cars and the workers,

the cars sellers and staff.

the oil compagnies

the insurance compagnies

etc etc

What I think the poster means is that 0.05% is statistically a very small amount of customers defaulting.

[JesseFrank]

What you are missing is if they default the government gets the money back. So it is in the interest of the government to have you default. You default they get the incentive money back. What is the government incentive to understate the number? They have every reason to overstate it.

If they have been paid the 100,000B and they can no longer afford the monthly payments how are they going to be able to afford to give the 100,000B back to the government?

Sell property. Go to work in Pattaya. Stop drinking. Ask the Farang on the INTERNET. What difference does it make? It's after the fact of the discussion taking place here which is First Car Deals Default.

And how about the option, you can't scratch anything from a rock, so we simply don't pay back the 100.000

[Pui]

The first car buyers programme was always going to end in disaster. There will be 50,000 - 100,000+ defaulters in this scheme

If only 500 defaulted it is a rousing success not a disaster. Better check your math.

Indeed, only 0.05% defaulted and over 1 million cars are sold. The only negative effects are that the prices on the 2nd hand market are down and after the promotion the car sales are lower than normal.

Agreed and with regards to the 2nd hand car market....not in itself a bad thing as second hand cars here are terribly over valued.

The people I have spoken to in Bangkok have said that the increase in cars has caused more traffic in Bangkok.

Edited August 16, 2014 by Pui

[thailiketoo]

What you actually said is

"What you are missing is if they default the government gets the money back"

I just queried how. You made the statement.

From the OP, "Mr Somchai said his department had asked the Comptroller Department to file lawsuits against 21 buyers to reclaim the excise tax."

My point was if they default the government gets it's money back. What would you have said? If they default the government tries to get it's money back? Nitpicking are we?

nit·pick·ing

ˈnitˌpikiNG/

informal

adjective

noun: nitpicking; noun: nit-picking

1.

looking for small or unimportant errors or faults, especially in order to criticize unnecessarily.

[thailiketoo]

If only 500 defaulted it is a rousing success not a disaster. Better check your math.

Indeed, only 0.05% defaulted and over 1 million cars are sold. The only negative effects are that the prices on the 2nd hand market are down and after the promotion the car sales are lower than normal.

Agreed and with regards to the 2nd hand car market....not in itself a bad thing as second hand cars here are terribly over valued.

The people I have spoken to in Bangkok have said that the increase in cars has caused more traffic in Bangkok.

1. How many people out of the 10 million in Bangkok have you spoken to? 2. Was the purpose of the car buying scheme to reduce traffic in Bangkok?

[alanrchase]

What you actually said is

"What you are missing is if they default the government gets the money back"

I just queried how. You made the statement.

From the OP, "Mr Somchai said his department had asked the Comptroller Department to file lawsuits against 21 buyers to reclaim the excise tax."

My point was if they default the government gets it's money back. What would you have said? If they default the government tries to get it's money back? Nitpicking are we?

nit·pick·ing

ˈnitˌpikiNG/

informal

adjective

noun: nitpicking; noun: nit-picking

1.

looking for small or unimportant errors or faults, especially in order to criticize unnecessarily.

As you can obviously use a dictionary please check out "Default" as it applies to finance and let me know if the 12000 people who have missed payments for several months would be considered to have defaulted on their loans.

[thailiketoo]

What you actually said is

"What you are missing is if they default the government gets the money back"

I just queried how. You made the statement.

From the OP, "Mr Somchai said his department had asked the Comptroller Department to file lawsuits against 21 buyers to reclaim the excise tax."

My point was if they default the government gets it's money back. What would you have said? If they default the government tries to get it's money back? Nitpicking are we?

nit·pick·ing

ˈnitˌpikiNG/

informal

adjective

noun: nitpicking; noun: nit-picking

1.

looking for small or unimportant errors or faults, especially in order to criticize unnecessarily.

As you can obviously use a dictionary please check out "Default" as it applies to finance and let me know if the 12000 people who have missed payments for several months would be considered to have defaulted on their loans.

OP, "The number of first-time car buyers who have failed to continue paying instalments to leasing companies has increased sharply from 10-20 cases last year to over 500 cases this year.....

there are over 12,000 cases at risk of defaults"

Who should we ask about defaults on loans in Thailand; you or Mr Somchai Poonsawat, director-general of the Thai Excise Department.

Mr Somchai Poonsawat, says there are 500 defaults. Mr Somchai Poonsawat, director-general of Excise Department decides what is and is not a default in Thailand.

Analysis 1st it was 500 people defaulting is bad. (proved wrong) 2nd it was 500 is not the correct number (proved wrong) 3rd The Thai definition of default is wrong. You guys are funny. Predictable but funny.

Edited August 16, 2014 by thailiketoo

[alanrchase]

What you actually said is

"What you are missing is if they default the government gets the money back"

I just queried how. You made the statement.

From the OP, "Mr Somchai said his department had asked the Comptroller Department to file lawsuits against 21 buyers to reclaim the excise tax."

My point was if they default the government gets it's money back. What would you have said? If they default the government tries to get it's money back? Nitpicking are we?

nit·pick·ing

ˈnitˌpikiNG/

informal

adjective

noun: nitpicking; noun: nit-picking

1.

looking for small or unimportant errors or faults, especially in order to criticize unnecessarily.

As you can obviously use a dictionary please check out "Default" as it applies to finance and let me know if the 12000 people who have missed payments for several months would be considered to have defaulted on their loans.

OP, "The number of first-time car buyers who have failed to continue paying instalments to leasing companies has increased sharply from 10-20 cases last year to over 500 cases this year.....

there are over 12,000 cases at risk of defaults"

Who should we ask about defaults on loans in Thailand; you or Mr Somchai Poonsawat, director-general of the Thai Excise Department.

Mr Somchai Poonsawat, says there are 500 defaults. Mr Somchai Poonsawat, director-general of Excise Department decides what is and is not a default in Thailand.

Analysis 1st it was 500 people defaulting is bad. (proved wrong) 2nd it was 500 is not the correct number (proved wrong) 3rd The Thai definition of default is wrong. You guys are funny. Predictable but funny.

Thanks for clearing that up. Bye.

[KamalaRider]

So, 500 defaulting and the rest still learning to drive.

And they learn live and then maybe not.

[kingstonkid]

Is there any promise that the PTP made that actually worked n the countries favour?

Just wondering??

[tingtongteesood]

BIG surprise - NOT !!!

[thailiketoo]

Is there any promise that the PTP made that actually worked n the countries favour?

Just wondering??

What promise did PTP make to the 500 people who defaulted on car loans?

Just wondering?

[frollywolly]

The first car buyers programme was always going to end in disaster. There will be 50,000 - 100,000+ defaulters in this scheme

If only 500 defaulted it is a rousing success not a disaster. Better check your math.

Indeed, only 0.05% defaulted and over 1 million cars are sold. The only negative effects are that the prices on the 2nd hand market are down and after the promotion the car sales are lower than normal.

That is the current default rate.

Let me make this clear to you.

It will not be the future default rate. The future default rate will be around 5%, that will be in 2 years.

[thailiketoo]

BIG surprise - NOT !!!

Why, I expected a lot more than 500 (that is the topic right?) defaults how many did you expect?

Edited August 16, 2014 by thailiketoo

[Timwin]

Any bank would gladly take over this kind of loan portfolio, even with all of those 12000 defaulting. That is less than one percent of 1.6 million. The first (pickup) car increases greatly the business opportunities and income for your average Somchai. Instead of hauling stuff with 15 year old rusty motorbike from a local market, he can fill up more into his pickup from multiple locations.

[JesseFrank]

Any bank would gladly take over this kind of loan portfolio, even with all of those 12000 defaulting. That is less than one percent of 1.6 million. The first (pickup) car increases greatly the business opportunities and income for your average Somchai. Instead of hauling stuff with 15 year old rusty motorbike from a local market, he can fill up more into his pickup from multiple locations.

Strange that still have avoided to answer the question as to why Thai people default a lot on normal car finances, but not on the car finance from the first car rebate.

At the end it are the very same Thai people.

Let me whisper the secret in your ear, don't tell anyone ok. They are using the 100.000 Baht for their monthly installments. Now wait till that 100.000 has evaporated.

[frollywolly]

Any bank would gladly take over this kind of loan portfolio, even with all of those 12000 defaulting. That is less than one percent of 1.6 million. The first (pickup) car increases greatly the business opportunities and income for your average Somchai. Instead of hauling stuff with 15 year old rusty motorbike from a local market, he can fill up more into his pickup from multiple locations.

Strange that still have avoided to answer the question as to why Thai people default a lot on normal car finances, but not on the car finance from the first car rebate.

At the end it are the very same Thai people.

Let me whisper the secret in your ear, don't tell anyone ok. They are using the 100.000 Baht for their monthly installments. Now wait till that 100.000 has evaporated.

Finally, someone with common sense.

[Timwin]

Any bank would gladly take over this kind of loan portfolio, even with all of those 12000 defaulting. That is less than one percent of 1.6 million. The first (pickup) car increases greatly the business opportunities and income for your average Somchai. Instead of hauling stuff with 15 year old rusty motorbike from a local market, he can fill up more into his pickup from multiple locations.

Strange that still have avoided to answer the question as to why Thai people default a lot on normal car finances, but not on the car finance from the first car rebate.

At the end it are the very same Thai people.

Let me whisper the secret in your ear, don't tell anyone ok. They are using the 100.000 Baht for their monthly installments. Now wait till that 100.000 has evaporated.

"It appears that we have been defaulted on , the missus bought a 1.5 in December 2012 with the promise of 100,000 back from the government and we still have nothing"

They have not even received that 100 000 Bath yet. So there goes your theory...out of the window.

[JesseFrank]

Any bank would gladly take over this kind of loan portfolio, even with all of those 12000 defaulting. That is less than one percent of 1.6 million. The first (pickup) car increases greatly the business opportunities and income for your average Somchai. Instead of hauling stuff with 15 year old rusty motorbike from a local market, he can fill up more into his pickup from multiple locations.

Strange that still have avoided to answer the question as to why Thai people default a lot on normal car finances, but not on the car finance from the first car rebate.

At the end it are the very same Thai people.

Let me whisper the secret in your ear, don't tell anyone ok. They are using the 100.000 Baht for their monthly installments. Now wait till that 100.000 has evaporated.

"It appears that we have been defaulted on , the missus bought a 1.5 in December 2012 with the promise of 100,000 back from the government and we still have nothing"

They have not even received that 100 000 Bath yet. So there goes your theory...out of the window.

Well it wasn't a secret that a very few haven't received their rebate yet. From your remark it is clear that it are actually 500 customers in that position.

[Timwin]

Well it wasn't a secret that a very few haven't received their rebate yet. From your remark it is clear that it are actually 500 customers in that position.

From where do you get that "very few"? Just another one of your biased opinions.

[JesseFrank]

Well it wasn't a secret that a very few haven't received their rebate yet. From your remark it is clear that it are actually 500 customers in that position.

From where do you get that "very few"? Just another one of your biased opinions.

Well since my opinions are considered biased, I'll leave it to you to post the link to a reliable source that shows us that it are actually a lot who haven't received the rebate yet.

[thailiketoo]

The first car buyers programme was always going to end in disaster. There will be 50,000 - 100,000+ defaulters in this scheme

If only 500 defaulted it is a rousing success not a disaster. Better check your math.

Indeed, only 0.05% defaulted and over 1 million cars are sold. The only negative effects are that the prices on the 2nd hand market are down and after the promotion the car sales are lower than normal.

That is the current default rate.

Let me make this clear to you.

It will not be the future default rate. The future default rate will be around 5%, that will be in 2 years.

Nonsense post. You have no data or educated opinions that support this statement. I think making inflammatory statements (5% default rate) should be removed. It is like spreading a rumor that the sun won't rise in the morning. Some nut out there might actually believe you and hurt himself. A 5% default rate would have serious consequences to the economy and your rumormongering should be stopped unless you have some evidence to support your statement.