Manufacturing production index drops by 5.13% in March

Continuing its downward trend for the 18th month in a row, the manufacturing production index experienced a 5.13% drop in March compared to the same period last year, according to an Industry Ministry report.

This decline, which is more severe than analysts’ predictions, is attributed to a slowdown in automobile production, a decrease in exports, and increasing household debt.

Analysts previously forecast a 1.9% year-on-year fall for March, according to a Reuters poll. However, the reality proved more substantial, following a revised 2.79% decline in the previous month, February.

Despite the gloomy figures, Warawan Chitaroon, Director General of the Office of Industrial Economics, reported a 3.65% drop in factory output for the first quarter of the year but hinted at the possibility of recovery.

Warawan’s optimism stems from an increase in orders at this year’s annual Bangkok International Motor Show, in conjunction with a likely uptick in tourism, and the eventual rollout of the government’s postponed 2024 budget.

“Orders at the motor show were higher this year, which is a positive sign.”

Adding credence to her hopeful outlook, it was revealed that orders at the annual motor show earlier this month witnessed a 28% increase compared to last year, reported Bangkok Post.

In related news, Thailand’s car production experienced a significant downturn of 23.08% in March compared to the same period last year, producing only 138,331 units, according to data from the Federation of Thai Industries (FTI). This follows a year-on-year decline of 19.28% in February.

Over the first quarter of the year, car production decreased by 18.45% year-on-year, amounting to 414,123 units.

According to the FTI, these falling figures are largely due to a decrease in pick-up truck production, spurred by softer demand as financial institutions tighten auto loans. In March, domestic car sales decreased by 29.83% year-on-year, following a decrease of 26.15% from the previous month.