Thailand Auto Finance Growth is driven by Rise in Number of Financing Options and high Financial Penetration Rate: Ken Research

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“While oil price in 2019 is expected to linger at a relatively high level, government bodies are encouraging EV production via incentives and tax reductions. In alignment with this wave, the Thai Finance Ministry reduced excise tax rates for EV cars since 2017, driving domestic sales of hybrid electric vehicles (HEVs), battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs). This trend will likely continue into 2019 despite the expected decline in the overall domestic automotive sales”.

Analysts at Ken Research in their the latest publication “Thailand Auto Finance Market Outlook to 2024: Growing The prominence of Captive Finance Companies and Loan Portfolio of Banks acting as a The catalyst for Market Growth” believe that the market demand is likely to follow a growing trend in the near future due to a forthcoming increase in the used cars sales and a shift towards newer models of mobility such as car-sharing and leasing, which will, in turn, help the economy grow as well. Some positive factors expected to impact the market are the influx of digitization based lending models (introduction of fin-tech products), the spread of customized loan products and a further rise in the penetration rate of banks and captive finance. The market is anticipated to register a positive CAGR of 8.8% in terms of credit disbursed and 10.2% in terms of the total loan outstanding during the forecasted period 2019-2024.

Thailand Auto Finance Market

Important Role of Thai Captive Finance Institutions: Working in association with dealers, captive companies used a variety of strategies to promote sales as a way of reducing large stock holdings, which following the earlier period of expanded output by manufacturers had grown too high levels. Among these strategies, they introduced ‘balloon loans’. These loans are a way of extending financing to low-income groups and are structured so that payments for each installment are low, with the outstanding balance paid off by a large lump-sum payment in the final period. In addition, installment periods were extended to 3-6 months each so that individuals who have seasonal incomes, such as many of those who work in the agricultural sector could also gain easier access to credit.

Simplification of Lending Process: With indirect lending gaining precedence over direct lending, the loan process doesn’t involve communication between the credit institution and the consumer for discussing loan terms and payments. With flexible payment options being introduced, the spotlight has shifted from affordability to convenience. Borrowers are now looking for flexibility in loan terms as well as refinancing options if the need arises. Lenders have been introducing customized products in order to cater to the needs of different consumer profiles and online lending models have simplified and improved the ease with which borrowers can compare and avail financing for their vehicle.

Investment by Japanese Automakers will act as a catalyst to Revenue Growth: Several Japanese automakers have conveyed plans for further investment within Thailand, which should help the government implement its roadmap to build a globally competitive automotive industry. The investment will be used to expand the company’s business in Thailand during the period of 2019-2023. This will further boost up the sales of various passenger car companies in Thailand thereby, creating a positive impact on the Thailand auto finance market.

Key Segments Covered:-

By Vehicle Financed

New Vehicles

Used Vehicles

By Lender Institutions

Banks

Captives

Non Banking Finance Companies (NBFCs)

By Type of Finance

Passenger Vehicle

Commercial vehicles

Registration Pledge

Floor Plan

By Type of Vehicle

New Auto

Used Auto

Motorcycles

By Loan Tenure between New and Used Autos

One Year

Two Years

Three Years

Four Years

Five Years or more

Key Target Audience

Existing Auto Finance Companies

Banks

OEM Dealerships

Captive Finance Companies

Credit Unions

Private Finance Companies

New Market Entrants

Government Organizations

Investors

Automobile Associations

Automobile OEMs

Time Period Captured in the Report:

Historical Period: 2014-2019P

Forecast Period: 2019P-2024F

Key Companies Covered:

Banks

Thanachart Bank

Ayudhya Bank

Siam Commercial Bank

TISCO Bank

Kiatnakin Bank

Kasikorn Bank

ICBC Bank

Krungthai Bank

NBFCs

Muangthai Capital

Asia Sermkij Leasing

Nakhon Luang Capital Limited

Thitikorn

Summit Capital

Group Lease

Aeon Thana Sinsap

G Capital Public Limited

Thai Ace Capital

SGF Capital

JMT Network

Phatra Leasing Company

Mitsib Leasing

Captives

Toyota Leasing Thailand

Mercedes-Benz leasing

BMW Financial Services

MITSU Leasing Thailand

Ford Services Thailand Company Limited

Honda Leasing Thailand Company Limited

Hyundai Motor Thailand Company Limited

KIA Motors Finance

Mazda Financial Services Limited

Suzuki Motor Thailand Company Limited

Volvo Financial Services

Tri Petch Isuzu Leasing Company Limited

Land Rover Financial Services

Mini Financial Services

Porsche Financial Services

Thai Rung Union Auto Public Company Limited

Key Topics Covered in the Report:-

Thanachart Bank Auto Hire Purchase Market

Mercedes-Benz Car Finance Market Analysis

Muangthai Capital Car Loan Market Share

Aeon Thana Sinsap Net Interest Income in THB Million

Motorbike Loan Market Thailand

Best Car Financing Options Thailand

Two Wheeler Loan Market Thailand

Car Loan interest Rate Thailand

Auto Loan Car Sales Thailand

Digitization of Vehicle Finance Market Thailand

Thailand Light Truck Finance Industry Analysis

Banks Finance Market Share Thailand

Non-Banking Finance Companies Revenue in Thailand

Thailand Auto Loan Outstanding in THB Billion

For More Information On The Research Report, Refer To Below Link:-

Thailand Auto Finance Market Analysis

Related Reports by Ken Research:-

Vietnam Auto Finance Market Outlook to 2023 – by Loan Tenure, by Type of Institution (Commercial Banks and Non- Banking Financial Institutions) and by Type of Vehicle (Passenger and Commercial)

Philippines Auto Finance Market Outlook To 2023 – By Banks And NBFCs Including Captive Units (Auto Loan Portfolio And Motor Cycle Loan Portfolio), By New And Used Motor Vehicles, By Motor Vehicle Financed (Passenger And Commercial Vehicles), By Loan Time Period.

Indonesia Auto Finance Market Outlook To 2024: Growing Prominence Of Captive Finance Companies Backed By Surging Auto Sales To Drive Market Growth

Contact Us:-

Ken Research

Ankur Gupta, Head Marketing & Communications

Ankur@kenresearch.com

+91-9015378249

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