Ayudhaya keen on staying top of car-loan refinancing market

"We foresee tougher competition so we have to continue maintaining our leadership in the refinancing market," managing director Pairote Cheunkrut said yesterday.

The strategy is hoped to grow the company's business by 20 per cent and customer base by 15 per cent next year.

The car leasing market reaches Bt500 billion, of which used cars account for Bt100 billion. Of the total used car market, the refinancing business shares Bt25 billion.

The company's Car4Cash business, a credit line provider , enjoys 40 per cent of the Bt25 billion total refinancing market, but the

Car4Cash business is predicted to slow from 30-per-cent growth this year to 20 per cent next year.

Credit loans for cars are expected to expand by 10 per cent next year, versus average annual growth of 20-30 per cent, due to the global financial crisis.

The company will look for more alliances by increasing its dealers from the current 250 to 500, and working closely with more than 2,000 used car dealers. Its Car4Cash Delivery team will go from 400 to 600 persons to extend services to the home.

A promotional campaign will be launched offering a zero-per-cent interest rate and 100-per-cent loans that fully cover the asset price. The advertising budget has been hiked from Bt150 million this year to Bt200 million next year.

The goal is to increase the company's customer base by 15 per cent from the current 100,000 borrowers.

 "During the severe competition next year, we cannot launch any new different products, so we have to focus on service," Pairote said.

Of the company's total credit portfolio of Bt40 billion-Bt50 billion, used cars account for 50 per cent, refinanced credit for 42 per cent and motorcycles 8 per cent.

The company still pays close attention to risk management to keep its non-performing loan ratio low at 2.1 per cent, compared with the market's average of 2.5-3 per cent.

Siriporn Chanjindamanee