How Thailand Auto Finance Market Is Positioned?
The auto finance market has played an imperative role in the overall GDP contribution in the Thai economy with a valuable contribution of ~ in terms of auto loan disbursed by the end of 2019 (Provisional). The market compasses similar trends fairly in-line with the domestic vehicle sales market, qualitatively & quantitatively. After witnessing a burst in 2015 the market is currently placed in its recovery phase registering a slow-moving growth rate.
Major operations are conducted by three types of entities namely, Banks & Subsidiaries, Captive Finances, and Non-Bank Financial Institutes. Numerous new business strategies were adopted by major players including the launch of “Cash Your Car”, First Car Buyer The scheme, and Floor Plan Model with competitors indulging in maintaining extensive collaborations with luxury dealers like Volvo for product sales expansion.
The Auto finance market has increased in terms of loan disbursed to approximately THB ~ billion in 2019P from THB ~ billion in 2014 registering a CAGR of ~% during the same period. The credit disbursed in the Thailand Auto Finance Industry has increased from THB ~ billion in 2013 to THB ~ billion in 2019P. The number of vehicles financed increased from ~ in 2014 to ~ in 2019P. There have been various factors responsible for the growth. One of the major factors has been the consistent growing level of sales of used vehicles in Thailand along with a vast array of financing options being offered by lenders. Moreover, convenience in lending is being improved as online lending ecosystems contribute to the rising total addressable market in vehicle finance and lenders offer highly customized products catered to the borrower’s needs. The Issuance of digitally Advanced Products, being offered by various Fintech Institutions, also acts as a Catalyst to the Growth of Industry.
Thailand Auto Finance Market Segmentation
By Vehicle Financed (2019): In Thailand, a sale is done for both new and used vehicles. Financing of New Car was observed to dominate the market during 2019P. New Vehicle Finance enjoys a majority share in the market owing to the advantages that come handy with the new vehicles that include higher resale value and better financing schemes. Used vehicles capture a comparatively lower share in the market in terms of Units Financed.
By Tenure of Loan: The loan tenure selected by the customer depends on factors such as the price of the car, income level of the customer, flexible scheme options and other social factors such as family size and lifestyle of the individual. The most preferred loan the time period in the Thailand Automotive market for the year 2019P is for 2 years.
By Type of Financing: The research showcased that Passenger vehicle finance is the leader in terms of financing acquired and amounts to ~ of the total loan outstanding in 2019P. After this, the Commercial vehicle segment of the market covers, ~ of the market and Registration pledge covers similarly ~ of the market, while the rest ~ of the total loan outstanding amounts to floor plan loans.
By Type of Vehicle financed: It was witnessed that out of Passenger loan outstanding, new Vehicle loans amount to ~ while Used Vehicle loans amount to ~ and motorcycle loans amounts to the only ~ of the total Passenger vehicle loan outstanding market.
By (Banks, NBFCs, and Captives): Commercial banks have accounted for a Major Share in the Overall Car Finance Market of Thailand on the basis of vehicles Financed. The second position in the market was captured by Captives and the third is captured by nonbanking finance Companies, which operate in the market for Automotive financing in 2019P.
Competitive Landscape In The Thailand Auto Finance Market
Competition in the market is moderately fragmented. The Major lending institution types in the market are Banks, Captives, Multi Finance Companies, they hold a moderately Fragmented share in the lending space for New Cars. However, the top 6 players in the market make up for almost 50% of the share, but the market of Captives and NBFC’s are majorly fragmented and totally amounts to more than 150+ players in the market. Competing Parameters: These entities majorly compete on the basis of diversification of services; interest rates charged, expanded distribution network & regional presence and enhanced customer relationship. One of the chief competing parameters is digitalization that has completely changed the market along with major strategies used to attract customers & expand business including Cash Your Car and others. The major players include Thanachart Bank, Ayudhya Bank, Siam Commercial Bank, TISCO Bank Capital, Asia Sermkij Leasing, Nakhon Luang Capital Limited, Thitikorn PCL and others.
Thailand Auto Finance Market Future Outlook and Projections
Over the forecast period, the Thailand auto finance market is expected to be positive if there is a continuous need for Car among the population. Multiple fin-tech startups have also come up in the country’s financial sector which poses a threat to conventional finance companies and banks. These startups have developed products to augment the digitalization of the banking sector. This includes digital payments, online lending, online aggregation, and remote banking facilities which made the customer lending process uncomplicated and simple further facilitating the car finance market in the country. Banks and Captives are expected to continue their leading position in the market due to their vast networks and range of products. In addition to that, the Thailand market is likely to witness a decline in Car sales which threatens the growth of a number of loans issued in the future.
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:-
Thailand Auto Finance Market Overview and Genesis
Thailand Auto Finance Market Ecosystem, 2019P
Value Chain Analysis of the Thailand Auto Finance Market, 2019P
Thailand Finance Market Value Chain Analysis
Thailand Auto Finance Market Size, 2013-2019P
Thailand Auto Finance Market Segmentation, 20113-2019P
Major Trends and Development in Thailand Auto Finance Market
Issues and Challenges in Thailand Auto Finance Market
Regulatory Framework in the Thailand Auto Finance Market
Snapshot on Thailand Automotive Sales and Manufacturing Market, 2014-2019P
Ways to Finance Automotives in Thailand (Bank Finance or Multi Financing Companies, Personal Finance, Lease Financing)
Vendor Selection Process for Auto Finance Company in Thailand
Competitive Landscape Containing Company & Product Profiles in the Thailand Auto Finance Market
Financial Penetration of various OEM Brands
Thailand Finance Market Future Outlook and Projections, 2019P-2024
Analyst Recommendations for the Thailand Auto Finance Market
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