Japanese automaker Suzuki will phase out its eco car production in Thailand while introducing four new models including hybrids and EVs imported from Indonesia, India and possibly Japan starting next year.

Suzuki Motor Thailand (SMT) president Tadaomi Suzuki told Thai media in a press conference July 18 that due to the significant changes in the Thai automobile market scenario, Suzuki has decided to revamp its business plan for the South East Asian region, first by shutting down its Thai plant in Rayong province by the end of 2025 and relocating production to stronger markets.

Tadaomi Suzuki

“With the entry of new players in the market in addition to the end of the Thai Eco Car scheme next year, with no new car promotional schemes from the Thai government, Suzuki is now looking at the South East Asian market as a whole,” he said. “We will relocate production (from Thailand) to Indonesia which is our largest market in this region and introduce more suitable products and pricing for Thailand and ASEAN.”

Suzuki currently imports mini-MPVs and commercial trucks from Indonesia and is expected to bring in an EV from India. This could be based on the Suzuki eVX concept unveiled last year that has a driving range of 550kms. Other prospects include the Grand Vitara Hybrid that has an average fuel economy of 27.97km/liter and the Fronx mild hybrid.

Grand Vitara Hybrid
Fronx

Along with the sharp decline in the Thai automobile market, Suzuki sales have plummeted by 45 per cent during the first six months of this year. From January to June 2023, the company sold just 3,791 vehicles, down from 6,994 units during the same period last year.

According to SMT vice president Wallop Treererkngarm, total auto sales in Thailand could plunge to just 650,000 units this year due to several negative factors.

Wallop Treererkngarm

“During the first six months, total auto sales in Thailand reached only 307,995 units compared to 406,000 units during the corresponding period a year ago,” he said. “This is not due only to the entry of Chinese electric vehicles and the lack of new models from Japanese automakers. The decline rooted from the Covid period that resulted in economic slowdown and a large number of vehicles being repossessed. As a result, resale value of automobiles had fallen dramatically and consumers are holding back purchases while auto financing have simultaneously become more difficult.”

Wallop said Thailand’s household debt is at its highest (91.3 per cent of GDP at the end of 2023 according to the Bank of Ayudhya PCL) in addition to high inflation and interest rates.

“While automobile sales in Thailand peaked at 1.3 million units several years ago, it has been dropping since and in my opinion could fall to just 650,000 units this year,” he said.

Suzuki will continue to produce the Celerio and Swift in Thailand until the end of 2025 while importing the Ertiga, XL7 and Carry from Indonesia. Meanwhile, it will also introduce four additional new models to Thailand in 2025.

The new models will come from Indonesia, India and possibly Japan, and will also feature hybrid and electric powertrains.

Suzuki’s plant in Indonesia is its largest in ASEAN and currently produces 100,000 vehicles per year, while the Indian production will be raised from two million units per year to four million units per year by 2030, making it the largest Suzuki production in the world. In Japan Suzuki has a combined production of one million units per year from its three assembly plants.

“We will continue producing cars in Rayong until the end of 2025 and we are considering what to do next since we have to take into consideration the employees,” Suzuki said.

Suzuki Rayong plant

The Rayong plant produces just 10,000 vehicles per year and is not competitive enough for investment in new models.

“Suzuki will continue selling vehicles in Thailand and will continue to service vehicles and expand our sales network,” Wallop added.

Suzuki’s sales network had shrunk from 127 to a current 92 dealers during the past year, but six new dealers have recently been appointed and will start business in 2025. Wallop said more dealers will also be sought for areas that Suzuki is currently not present in.

“Suzuki has been present in Thailand for 49 years and we are still servicing old models like the Caribbean and Vitara today,” Wallop said. “Customers can be assured that we will continue to service their vehicles no matter how old they are, which also means that dealers will be able to do business as well.”

At the press conference, Suzuki also announced a new service campaign offering free three-year/60,000km labor cost for scheduled checks, 10-year spare parts availability after end of production for every model, introducing a customer smartphone app (Hello Suzuki) and other measures to maintain customer confidence.

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