Market Overview - Thailand's new vehicle market grew by over 5% to 47,622 units in August 2025, up from 45,190 units a year earlier, marking the fifth consecutive month of growth after two years of declines [1][2] Economic Context - Economic activity in Thailand has improved, with GDP growth accelerating to 3% year-on-year in the first half of 2025, primarily driven by strong export activity [3] - The Bank of Thailand has reduced its benchmark interest rate by 25 basis points four times in the last year, from 2.5% to 1.5%, to support the domestic economy [2] Vehicle Sales and Trends - Sales of battery electric vehicles (BEVs) rose by 27% year-on-year to 9,246 units in August, supported by increased local production from Chinese automakers under the Thai government's EV3.0 investment incentive program [4] - In the first eight months of 2025, total vehicle sales were slightly higher at 399,619 units compared to 399,611 units in the same period last year, with BEV sales surging by 52% to 72,274 units, accounting for 18% of total vehicle sales [5] Production and Export Challenges - Vehicle production in Thailand fell by 6% year-to-date to 947,697 units, primarily due to a 12% drop in exports to 602,975 units, influenced by stricter emissions regulations and rising competition from Chinese automakers [6] - The Federation of Thai Industries (FTI) revised its full-year vehicle output forecast down to 1.4 million units from an earlier estimate of 1.5 million units [6] Government Initiatives - The Thai government is considering introducing scrappage incentives to encourage the trade-in of old pickup trucks for new ones and has launched a THB 5 billion loan-guarantee program to support pickup truck purchases by small and medium-sized businesses, although this has not significantly impacted sales so far [7]