The Federation of Thai Industries (FTI) expects car manufacturing in Thailand to reach 2 million cars this year, close to the level recorded prior to the Covid-19 pandemic, despite concerns over the impact of costly electricity bills and banking problems overseas.
The Automotive Industry Club under the FTI earlier set the 2023 production target at 1.95 million cars.
"We see a good signal in Thailand's car production as car exports still keep growing and domestic sales are recovering, driven by the tourism industry," said Surapong Paisitpatanapong, vice-chairman of the FTI and spokesman for the club.
From January to March, total car manufacturing increased by 5.77% year-on-year to 507,787 units. In March, production increased by 4.16% year-on-year to 179,848 units.
"The increase in car production for domestic sales and export also resulted from the delivery of more semiconductor supplies to carmakers," said Mr Surapong.
"If the production stands at around 500,000 cars in each quarter, manufacturing for the whole year could reach 2 million cars."
In the first quarter, car manufacturing for export increased by 11.7% year-on-year to 288,130 cars. In March, car production for export rose by 11.7% year-on-year to 100,986 cars.
Prospects for car exports remain good, although there was a problem with shipping cars to Australia.
Australian authorities found some wild flower species among the cars exported from Thailand, sparking concerns over the spread of foreign plant species into that country.
"This incurred a cost on car manufacturers as they had to wash their cars at a port before shipping them," said Mr Surapong.
This additional expense, when combined with higher costs resulting from costly electricity bills in Thailand, is causing carmakers to consider increasing their car prices, he said.
Banking turbulence in the US, Switzerland and Germany is another risk factor that may hamper car exports from Thailand, Mr Surapong said.
According to the club, domestic car sales in March fell by 8.37% year-on-year to 79,943 cars.
