Increase in Vehicle Repossessions as Industry Faces Challenges
According to a report released by Union Auction Plc, the number of vehicles being repossessed for auction has surged this year, primarily due to economic factors and the introduction of affordable electric vehicles (EVs) from China.
Suthee Samathi, managing director of Union Auction, stated that the company has managed the auction of approximately 250,000 vehicles so far this year, an increase from 230,000 vehicles during the same period last year. This marks an 8.7% rise in auctions.
Interestingly, about 60% of the repossessed vehicles are pickup trucks commonly utilized for commercial purposes.
Impact of Affordable EVs and Economic Pressures
Suthee highlighted that the arrival of affordable EVs has significantly disrupted the pricing dynamics of the Thai automotive market.
The surge in vehicle repossessions can also be attributed to the sluggish economic growth, rising household debts, and increasing non-performing loans (NPLs). Suthee noted, ‘These economic factors are driving higher rates of repossession.’
Future Trends and Predictions
Looking ahead to the next year, Suthee predicts that the trend will persist, with Union Auction expected to manage around 250,000 vehicles in 2025. Despite this, he anticipates a 10-15% increase in the prices of used vehicles following a significant plunge of 30% in the latter half of the previous year.
In a previous year, only 40 EVs were auctioned off, but this year, the forecast indicates that around 100 EVs will be sold at auction.
This increase in repossessions and changing market dynamics emphasizes the evolving landscape of the automotive industry in Thailand.
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