What impact will the change of rule decreasing ownership from 5 to 3 years have?

[stament]

Thie rule around the THB100k discount requirement for new car buyers in 2011 to keep their carlooks like it's going to be relaxed from 5 years to 3 years.

Guessing we will see a flood of cars to the market, but this being Thailand, I'm not sure if we will see values lowering as the normal supply and demand rules don't seem to apply using thai logic in my experience! If something doesn't sell most westerners lower the price if they want to sell, that logic doesn't seem to apply to most Thais from what I've seen here with regards to cars, houses and land unless they are absolutely desperate to sell.

Obviously the govt feel this move will kickstart the buying of new cars if second hand owners sell but I'm not so sure the impact will be that great.

Any thoughts?

[tom21]

first I heard of this, where did this come from

[stament]

On thai visa news page

[cooked]

Do try to keep up.

Cars that have not been paid for are reclaimed by the bank. As long as these vehicles have a high resell value, the bank's assets on paper look healthy. Same applies to houses that have been uninhabited for years and are falling apart. Of the 1.3 million cars sold under the scheme, 400 000 were reclaimed. Prices may drop a little now that more cars can be sold legally by their owners.

[topt]

first I heard of this, where did this come from

On thai visa news page

Only a proposal at the moment - not yet passed.......

[IMHO]

One thing only: Lots more used eco cars flooding the used car market, and fuelling a further slump in prices.

[stament]

first I heard of this, where did this come from

On thai visa news page

Only a proposal at the moment - not yet passed.......

Yes I know that but as it was topical and from the journalistic take it looks like it will be implemented hence my question.

[stament]

Do try to keep up.

Cars that have not been paid for are reclaimed by the bank. As long as these vehicles have a high resell value, the bank's assets on paper look healthy. Same applies to houses that have been uninhabited for years and are falling apart. Of the 1.3 million cars sold under the scheme, 400 000 were reclaimed. Prices may drop a little now that more cars can be sold legally by their owners.

I'm not in the know as much as you, but don't think we should be mocked for that alone.

I didn't realise 400k vehicles had been repossessed - presumably these are on the car lots now and are auctioned off by lenders?

[cooked]

Do try to keep up.

Cars that have not been paid for are reclaimed by the bank. As long as these vehicles have a high resell value, the bank's assets on paper look healthy. Same applies to houses that have been uninhabited for years and are falling apart. Of the 1.3 million cars sold under the scheme, 400 000 were reclaimed. Prices may drop a little now that more cars can be sold legally by their owners.

I'm not in the know as much as you, but don't think we should be mocked for that alone.

I didn't realise 400k vehicles had been repossessed - presumably these are on the car lots now and are auctioned off by lenders?

When I first came to Thailand it seemed that every second car had a red plate. Nowadays they are a rarity. These unpaid for cars belong to the banks and as long as they are for sale at a high price with no takers, they are an asset. No way will these be auctioned off for a fair price. Makes the books look good. This is why I bought a new car and will be selling mt Eco car at 90 000Km and buying a new one.

Sorry if the 'do try to keep up' remark hurt any feelings.

[DavisH]

One thing only: Lots more used eco cars flooding the used car market, and fuelling a further slump in prices.

..and it's not just eco cars...larger B segment cars (e.g. jazz) and pickups are affected by this. Many will try to be sold in the market in the next two years. I think mine will be worth not much by then. so may as well keep it 10 years, if it lasts that long lol

[DavisH]

Do try to keep up.

Cars that have not been paid for are reclaimed by the bank. As long as these vehicles have a high resell value, the bank's assets on paper look healthy. Same applies to houses that have been uninhabited for years and are falling apart. Of the 1.3 million cars sold under the scheme, 400 000 were reclaimed. Prices may drop a little now that more cars can be sold legally by their owners.

I'm not in the know as much as you, but don't think we should be mocked for that alone.

I didn't realise 400k vehicles had been repossessed - presumably these are on the car lots now and are auctioned off by lenders?

How were these 400K cars resold? Looking at the car websites, they don't seem to be flooded with these cars as of yet.

[stevenl]

One thing only: Lots more used eco cars flooding the used car market, and fuelling a further slump in prices.

..and it's not just eco cars...larger B segment cars (e.g. jazz) and pickups are affected by this. Many will try to be sold in the market in the next two years. I think mine will be worth not much by then. so may as well keep it 10 years, if it lasts that long lol

I don't think the price of pickups will be affected much, but will be kept longer.

[elgordo38]

Do try to keep up.

Cars that have not been paid for are reclaimed by the bank. As long as these vehicles have a high resell value, the bank's assets on paper look healthy. Same applies to houses that have been uninhabited for years and are falling apart. Of the 1.3 million cars sold under the scheme, 400 000 were reclaimed. Prices may drop a little now that more cars can be sold legally by their owners.

400,000 reclaimed out of 1.3 million sold thats almost 1/3 reclaimed. WOW I find that astounding. Astounding also because I find it hard to believe the banks gave these people loans in the first place. Kind of makes me leery to put my money in banks here.

[elgordo38]

Do try to keep up.

Cars that have not been paid for are reclaimed by the bank. As long as these vehicles have a high resell value, the bank's assets on paper look healthy. Same applies to houses that have been uninhabited for years and are falling apart. Of the 1.3 million cars sold under the scheme, 400 000 were reclaimed. Prices may drop a little now that more cars can be sold legally by their owners.

I'm not in the know as much as you, but don't think we should be mocked for that alone.

I didn't realise 400k vehicles had been repossessed - presumably these are on the car lots now and are auctioned off by lenders?

Auctioned off? I hear banks want to get back the balance owing on cars and some sit there for years on used car lots depreciating. Again I guess they look good on the banks books.

[stament]

Ok makes sense but surely depreciating over a few years is worse for the banks books over a 5 year periods say than selling at a one off loss as the asset won't be woth as much in the future and they aren't allowed to keep it on the books at historic values if the asset is worth significantly less. Just stinks of short termism

[IMHO]

Ok makes sense but surely depreciating over a few years is worse for the banks books over a 5 year periods say than selling at a one off loss as the asset won't be woth as much in the future and they aren't allowed to keep it on the books at historic values if the asset is worth significantly less. Just stinks of short termism

They all have share prices and shareholders to worry about.

That said, many of them do go to auction, but pass through because they don't meet reserve.

[stament]

I find it odd as it will cost them money, I mean they must have to pay insurance, parking and security costs to keep these unsold vehicles.

[IMHO]

I find it odd as it will cost them money, I mean they must have to pay insurance, parking and security costs to keep these unsold vehicles.

Or they buy the 'parking lot' and keep shareholders happy because they just increased their assets?