We at KResearch expect that Thai car exports will reach approximately 1.15-1.18 million units in 2019, increasing slightly by 1-4 percent over the 1.14 million units projected for 2018, due to a number of downside risks. These include volatile global trade that may dent purchasing power in our export markets, uncertainty foreseen in forex and interest rates, plus the EU's new directives, aimed at controlling the number of cars emitting carbon dioxide. Moreover, many car makers have relocated production closer to potential markets in Europe and North America. However, there are several factors that may support our car exports, including the recovery in the Middle East market due to rising oil prices, positive responses from many markets toward our new pickup models and the fact that Thailand has been able to resume car exports to Vietnam after problems related to car import controls have eased.
Meanwhile, promising outlook is seen in Oceania and Asia, in particular Vietnam that will likely become our third largest car export market in 2019 after problems related to the Decree 116 have subsided somewhat. Given this, KResearch projects that Thai car shipments to Vietnam may grow 14-22 percent to 61,000-65,000 units in 2019.
However, Thai auto shipments to Europe and North America may shrink because many car makers have relocated production closer to these markets, especially Europe, to reduce logistics costs and enjoy tax benefits from respective free trade agreements. As a result, we expect that our 2019 car exports to Europe may remain unchanged from 2018 or shrink 4 percent to 118,000-123,000 units.