The 6 percent appreciation of Thailand’s baht since late last year has reduced profits in the domestic auto industry to only 3-4 percent, a representative of the Federation of Thai Industries (FTI) said on Friday.
Surapong Paisitpipatanapong, spokesman of the FTI auto industrial group, said the surging baht has compelled auto and parts manufacturers to reduce their prices to stay competitive in the export market.
The auto industry will face more difficulty if the baht strengthens to Bt28-29 against the dollar, he said, indicating that appreciation by Bt1 is equivalent to a Bt28.6 billion loss in auto exports.
The calculation was based on last year’s export value of US$28 billion.
But the Thai auto industry maintains its original export target of 1.1 million units for this year. The domestic sales target of 1.45 million units will also be unchanged though manufacturers foresee an increase to 1.5-1.6 million units.
“We have to wait for final sales figures from the Bangkok International Auto Week. We have to see how many people discard their bookings,” he said.
FTI chairman Payungsak Chatsuthipol said the baht’s movement is currently in line with other regional currencies but industrialists doubt it will remain stable.
Payungsak called on state agencies concerned to keep a close watch on foreign capital inflows which will have a negative impact on the Thai currency.
