The government's controls on air pollution, including the Euro 4 emission standards and new excise tax on motorcycles, based on carbon dioxide (CO2) emissions, which are expected to be enforced at the beginning of 2020, will likely have a varying effect on motorcycle price ahead.
In 2019, however, the sluggish Thai economy, low agricultural prices and stringent lending criteria are key factors that will likely hurt domestic motorcycle sales. Given this, we at KResearch expect that motorcycle sales in the country may reach only 1,755,000 units, shrinking 2 percent YoY.
Looking into 2020, it is expected that air pollution measures will affect motorcycles, with displacement engines above 125 cc., thus forcing such motorcycle makers to raise prices somewhat, though such models account for a small share of the market. Although sales of such motorcycles will likely accelerate from the end of 2019 onward as prospective buyers may avoid the price hikes, domestic motorcycle sales overall will largely depend on motorcycles, with displacement engine below 125 cc., which continue to face economic risks.
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