Thailand aims for big increase in car production

Thailand’s Industry Ministry has set a target for the country’s automobile production to reach three million units by 2017.

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The aim came on the back of this year’s record-setting production numbers. So far, output has exceeded two million units for the first time.

Total production for this year is expected to reach about 2.3 million, with the domestic market accounting for 1.3 million vehicles, according to a November 24 report by local English daily The Nation, which quoted the ministry’s permanent secretary Vitoon Simachokdee as saying.

The figures were in line with a recent report by Sahaviriya Steel Industries (SSI) – Thailand’s largest steel mill – released with its third quarter 2012 financial results.

In the report, the company said it expects steel demand in the automotive sector to continue to grow as a result of the rise in car output.

“Despite the fact that domestic production for exports has been facing the difficulty caused by the economic crisis in the European Union and China, domestic consumption remains at a high level,” SSI said.

About 252,165 vehicles were manufactured in October alone, up 410% over the same month last year. The high growth was due to the low production at the end of last year because of the massive floods that hit Bangkok and many provinces, The Nation report said.

About 2.5 million vehicles are expected to be manufactured in 2013, partly driven by the government’s first-car scheme, for which some deliveries will be made next year.

The scheme, which offers tax rebates to those buying their first vehicle, has provided a boost to the Thai auto industry.

It is part of the Thai government’s stimulus package to boost domestic consumption and help industrial sectors to continue their production amid a slowing global economy.