Thailand’s automotive industry experienced a 15.39% growth in car sales during the first seven months of 2026, with 406,162 units sold. However, a significant portion of this growth in the electric vehicle (EV) segment is driven by imports. Imported EVs accounted for 62.58% of all EV sales, while domestically produced EVs represented only 37.42%. This disparity has led the private sector to call for adjustments to the tax structure to create a more equitable playing field for locally manufactured vehicles.
Mr. Surapong Paisitphatthana, advisor to the president of the Automotive Industry Club and spokesperson for the Automotive Industry Club of the Federation of Thai Industries (FTI), highlighted these concerns on August 25, 2026. He noted that while EV sales surged by 97.39% to 125,411 units during the period, Thailand’s domestic EV production only reached 46,924 units. This imbalance raises questions about the fairness of tax policies when comparing imported and domestically produced EVs.
The private sector emphasizes the vital role of domestically produced cars in the Thai economy, generating employment, utilizing local components, and supporting suppliers. Mr. Surapong stressed that these vehicles must be able to compete fairly, regardless of whether they are internal combustion engine or fully electric models, under a tax system that does not disadvantage local manufacturing. The industry is currently analyzing the new tax structure and preparing to present its findings to the government to collaboratively find a solution.
Compounding these issues is a severe downturn in the pickup truck market, where sales have plummeted by over 60%, falling from over 30,000 units per month to approximately 10,000 units. This sharp decline is primarily attributed to stricter lending approval processes by financial institutions, exacerbated by Thailand’s prolonged period of low economic growth. The economy grew by 1.9% in the second quarter of 2026, a slowdown from the 2.8% growth recorded in the first quarter.
The impact of the pickup truck market slump extends beyond manufacturers, as these vehicles incorporate about 90% locally sourced parts. The reduction in sales and production has led to closures among parts manufacturers and has affected labor and related industries throughout the supply chain. Some companies have relocated their investments abroad due to the challenging market conditions.
Mr. Surapong reminded that pickup trucks have historically been a key Thai export product, with Japanese manufacturers establishing production facilities in the country decades ago for both domestic sales and export to over 120 countries. The current decline in production, estimated at about two-thirds, threatens Thailand’s position as a global pickup truck manufacturing hub and impacts numerous businesses.
To address the pickup truck crisis, Mr. Surapong proposed the establishment of a pickup truck loan guarantee fund. He referenced a previous suggestion by the Joint Committee of Three Private Institutions (JC3PI) for the government to create a fund that would guarantee financial institutions against losses from repossessed vehicles, up to 50,000 baht per vehicle. Such a measure, he believes, would incentivize financial institutions to increase lending for pickup trucks, thereby stimulating sales and production, supporting employment and income within the supply chain, and boosting domestic purchasing power. An increase in consumer income and purchasing power would, in turn, lead to higher household spending, improved debt repayment capacity, and greater investment and employment opportunities, while also increasing government revenue through various taxes.
Mr. Surapong also noted the limited success of a previous pickup truck loan guarantee fund from the Ministry of Finance, which saw only around 2,000 participants and failed to significantly stimulate the automotive industry as envisioned by the JC3PI. He recalled that the government had previously cited budget constraints when the JC3PI proposed a broader fund to support the automotive industry.
Ultimately, Mr. Surapong reiterated that robust economic growth, matching or exceeding that of competitors, is the most effective strategy for attracting and retaining efficient investment. When manufacturers can achieve sales, profitability, and maintain liquidity, they are more inclined to preserve their production bases in Thailand and invest further, rather than being drawn to other countries.