The Federation of Thai Industries (FTI) is monitoring US President Donald Trump's plan to slap a 25% tariff on car imports to the US and plans to assess its impact on the sluggish Thai automotive industry.
Trump said on Feb 19 that he intends to impose auto tariffs "in the neighbourhood" of 25% and will provide further details on April 2 when new tariffs are scheduled to take effect, according to media reports.
Cars exported from the EU to the US are a main target of this tariff policy, said Trump.
"It's too soon to say whether the new tariff will affect Thailand. This is just the beginning of the plan," said Kriengkrai Thiennukul, chairman of the FTI.
While the negative impact on car exports from Thailand remains unknown, the new auto tariff may cause changes to the business direction of some global automakers.
"We may benefit if car companies decide to relocate or expand their production facilities in Southeast Asia, including Thailand, which is a major manufacturing base," said Mr Kriengkrai.
In December last year, Thailand's car exports dropped by 15.5% year-on-year to 76,346 vehicles, attributed to geopolitical conflicts that slowed economies across the world, particularly Thailand's trading partners, according to the FTI's Automotive Industry Club.
Competition in the global automotive market has intensified as China exports more electric vehicles. There are also strict carbon tax regulations in various countries that have affected car exports.
In 2024, Thai car exports decreased by 8.80% year-on-year to 1.01 million units.
The FTI previously set up a war room to monitor Trump's trade policy following concerns his stiff tariffs on products from China would lead to a flood of shipments to Southeast Asia, worsening the influx of low-cost Chinese products into the Thai market.
The federation reported on Wednesday the Thai Industries Sentiment Index increased to 91.6 points last month, up from 90.1 points in December 2024, attributed to export expansion, government stimulus measures, and foreign tourist arrivals during New Year and Lunar New Year holidays.
Thailand's trading partners, including the US, China, the EU and Cambodia, Laos, Myanmar and Vietnam, increased imports to stockpile, said ML Peekthong Thongyai, vice-chairman of the FTI.
The government's 10,000-baht cash handout for the elderly and the Easy E-Receipt tax rebate programme also stimulated people's spending, he said.