In Thailand, the ratio of household debt (outstanding personal and household loans, including mortgages, auto loans, and credit card debt) to GDP has remained high, exceeding 90% from Q3 2020 to Q1 2024.

It fell below 90% for the first time in many years in the second quarter of 2024, but remains high at 89.6%. When household debt-to-GDP ratios are high, banks and loan companies tend to tighten their auto loan approval process. This has led to a slump in sales of 1-ton pickup trucks, which make up a large portion of the market, and the Thai auto market has been stagnant since around 2023.

In ASEAN countries and India, Japanese OEMs have secured the majority of the market, and it is no exaggeration to say that these countries are the backyard of the Japanese auto industry, supporting its profitability. However, loan screening for pickups is so strict that even if they wanted to buy them, they cannot. For Isuzu, Mitsubishi Motors, Toyota and the suppliers who supply them with parts, the biggest concern is when the reluctance to lend loans will be resolved.

In recent years, this situation has changed. In the past, the Vietnamese market was dominated by Japanese OEMs such as Toyota, but Hyundai Motor has recently been competing with Toyota for the top market share by building its own plant and expanding sales of locally produced models. In other ASEAN countries, Japanese OEMs continue to dominate, but in Thailand, Chinese OEMs such as Great Wall and Shangqi are expanding their presence in the BEV market.

In Asia, startups such as Hon Hai in Taiwan, VinFast in Vietnam, and Grab in Singapore are aiming for dominance in the Asian automotive industry as game changers, although their operations differ from contracted vehicle development and production, BEV business, and MaaS platforms centered on vehicle delivery. Meanwhile, looking at suppliers, Korean manufacturers such as LG, Samusung, and SK have secured a large presence in the global battery market and are competing for supremacy with China’s CATL, the largest supplier. In the area of automotive infotainment systems, Taiwanese EMS companies such as Hon Hai and Wistron have become indispensable designers and manufacturers.