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Hope of Political Stability Revived Thailand?s Auto Industry
Nov 02, 2007

The automotive industry in Thailand has shown growth of nearly 53,490 units in September 2007, which was set back due to political instability in the country.

The Thailand’s auto sales increased almost 8.5% YOY in September 2007 as the consumers were optimistic regarding the political overview way ahead of Thailand’s first poll since the 2006’s military coup, as per the Toyota Motors. The industryweek published this news.

In September 2007, the sales increased nearly 53,490 units, but the auto sales for the initial nine months of 2007 dropped almost 7.6% from the 451,320 units from previous year’s first nine months. As per Toyota Motors, the revised sales estimate is 4.7% lower than that of 2006. The political chaos in Thailand regarding Thaksin Shinawatra, pre-Prime Minister, who was thrown out in a bloodless revolution in 2006 by the military, and the low customer confidence affected the automotive industry in the country.

But the customers showed more confidence and increased their spending since the political situation has gained some stability ahead of the December 23, 2007’s general election. This has increased sales in the automotive industry. The Motor Industry Development Programme as well as strong demands from local and foreign sectors has pushed the sales in the auto sector and this is helping the overall growth of the country’s auto industry.

Thailand has adopted various important measures to boost the country’s already prospering automotive sector. Thailand is one amongst the AFTA’s (ASEAN Free Trade Area) ten countries, and in order to push up the growth in the sector, numerous trade tariffs have been eliminated by AFTA. Some of the chief reasons attracting the foreign auto companies to create a base in Thailand are low cost of importing products back home and access to the highly attractive market of South East Asia.

In the opinion of a research expert at RNCOS, “Thailand’s automotive industry was set back due to a number of reasons, like the political instability. But September 2007’s auto sales’ result has revived the spirits of the auto players. The country’s government is also playing a crucial role to push up the growth in the automotive industry. On the whole, Thailand’s auto industry has a bright future ahead”.

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