Thailand's Manufacturing Production Index (MPI) rose by 2.1% year-on-year to 92.3 points in April, driven mainly by the improving automotive industry, says the Office of Industrial Economics (OIE).
Whether the MPI and the domestic auto market will continue to improve remains uncertain as Thailand faces local and external economic challenges, noted the agency.
In April, Thailand's capacity utilisation tallied 56.5%, a slight increase from 56% year-on-year.
"This indicates increasing production in the industrial sector, driven by the expansion of the auto industry as manufacturers produced more cars based on bookings during the recent motor show," said Passakorn Chairat, director-general of the OIE.
The 12-day Bangkok International Motor Show was held from March 26 to April 6.
Domestic vehicle sales in April increased by 0.97% year-on-year to 47,193 units, the first uptick in 23 months, according to the Federation of Thai Industries.
The last time Thailand posted a domestic auto sales increase was in May 2023, when sales rose by 0.55% year-on-year to 65,088 units.
Other contributors for the MPI gain include the Bank of Thailand's policy rate cut by 0.25 percentage points to 1.75% and government stimulus measures, said Mr Passakorn.
The measures to spark economic activities included the second phase of the state's 10,000-baht handout for the elderly and the "You Fight, We Help" debt relief scheme.
In addition to an improved auto market, animal feed production rose by 17.3% year-on-year, attributed to the growth of the domestic and overseas pet market, especially purchase orders from Japan.
Concrete, cement and plaster manufacturing also increased by 10.8%, driven by state and private construction projects, particularly transport infrastructure and house and factory construction.
Palm oil production rose by 13.4% as suitable weather increased palm output. However, more supplies led to a drop in palm prices.
In April, the production of refined oil products, including diesel, gasohol and gasoline, decreased by 3.8% due to the sluggish domestic economy, a slowdown in foreign tourist arrivals and lower purchase orders abroad.