BANGKOK: Thailand’s manufacturing production fell for the 17th straight month in February, down 2.84% from a year earlier, due to lower car production and high household debt, the industry ministry said on Thursday.

The fall was less than the 3.9% year-on-year slump expected for February in a Reuters poll, and followed January’s 2.94% fall from a year earlier.

Auto production was down for the seventh consecutive month due to weak domestic demand and exports, Warawan Chitaroon, head of the Office of Industrial Economics, told a briefing.

In the January-February period, factory output dropped 2.88% year-on-year.

The ministry forecasts manufacturing output to rise 2% to 3% this year after falling 3.78% in 2023.

In February, auto production fell 19.28% from a year earlier, largely due to a decline in production of pickup trucks and an increase in imports of electric vehicles (EVs), according to the Federation of Thai Industries.

Thailand is a regional automaking hub. Industrial goods account for about 80% of total exports, which rose 3.6% year-on-year in February, less than expected.

That compared to January’s 10% increase annually.

Thai Jan factory output drops 2.94% y/y, beats forecast

Thailand has one of the region’s highest ratios of household debt, at 16.2 trillion baht ($445.4 billion) or 90.9% of gross domestic product (GDP), as at the end of September 2023.

Hospitality-related industries including alcohol, however, were benefiting from brighter tourism prospects, said Warawan.

Thailand has received 8.73 million foreign tourists this year as at March 24, up 44% year-on-year.

The government is aiming for a record 40 million foreign visitors this year following the 28 million in 2023.