KASIKORN LEASING Co., Ltd. (KLeasing) has announced its 2021 performance, with outstanding loans totaling 121.166 million Baht, growing 5.46 percent YoY. The company’s Auto Loan (New Car) grew 32 percent, bucking the overall auto market which was in a contraction last year. For 2022, KLeasing is focusing on proactive marketing campaigns with the launch of car loan products to meet all customers’ lifestyles.
In line with KBank’s “Green Zero” policy, the company has introduced the “Buy BEV – Enjoy 3-Month Free Drive” campaign. Leveraging the strength of its vast service network plus KBank’s large customer base, KLeasing has strived to expand its online service channels and develop digital platforms while teaming up with its partners in continually launching marketing campaigns to appeal to customers.
Tirachart Chiracharasporn, KLeasing Managing Director, revealed that the Thai new car market registered total sales of 759,119 units in 2021, down 4.2 percent YoY. The decline could be attributed to two key factors, i.e., the intensified COVID-19 outbreak and the global electronic chip shortage which caused disruption in production lines of some car models for some time. As 2022 progresses, the overall improving situation has proved to be a boon for the domestic car market.
According to KASIKORN RESEARCH CENTER (KResearch), the overall auto market tends to recover, but will not yet return to pre-COVID levels. This year’s auto sales are expected to reach 800,000-850,000 units, or a rise of 5.4-12.0 percent over the previous year. Battery electric vehicles (BEVs) will benefit from government measures to encourage domestic BEV sales. For 2022, total BEV sales will likely amount to 4,000 – 5,000 units, surging 104.7 – 155.9 percent compared to last year’s record.
As for KLeasing’s performance in 2021, the company’s outstanding loans totaled 121,166 million Baht, rising 5.46 percent over 2020. Auto Loan (New Car) grew 32 percent, in contrast to new car sales in the market which dropped 4 percent, while Car to Cash increased 31 percent. The company’s improved performance was due to its strategy to launch new products reaching out to more diverse customer groups, including low-income customers, via auto hire purchase and Car to Cash (Car Registration Loan). In addition, the company has introduced used car loans via used car dealers, which are normally associated with considerably higher risks. However, KLeasing has established a credit policy framework to control risks and respond to both buyers and sellers, including new and used car dealers.
KLeasing’s assistance measures for customers affected by the COVID-19 outbreak have helped alleviate the financial burdens of almost 50,000 customers. As a result, the company’s NPLs in 2021 stood at 1.12 percent, decreasing by 0.20 percent from 2020. Due to its improved work processes and more efficient cost control, KLeasing’s total profit grew 52.86 percent to Baht 1,710 million.
Tirachart added that for 2022 business operations, KLeasing will gradually launch proactive campaigns via enhanced digital platforms, with the aim of meeting demand and offering customers the right products at the right time. Concurrently, KLeasing is set to bolster the company’s strength by continuously collaborating with its major strategic partners, including leading carmakers, plus new and used car dealers, in marketing various products.
In 1Q22, the company will press ahead with campaigns that are in line with KBank’s ‘Green Zero’ policy, including a special program for buyers of battery electric vehicles (BEVs), sales of which are projected to thrive during 2022. Customers who purchase BEVs through Auto Loan (New Car) will enjoy a worry-free 90-day free drive, from now until June 30, 2022. Meanwhile, KLeasing is scheduled to extend its Auto Loan (Used Car) by offering attractive special campaigns for pre-owned cars of dealers and private car sellers. Buyers of used cars from private sellers get an extended warranty for auto parts of up to 1 year or 30,000 km, from now until April 30, 2022.
Under Car to Cash, which is intended to boost financial liquidity for car owners who wish to get revolving credit for their businesses or multi-purpose spending, the company has introduced Car to Cash (Self-Declared), which offers them more hassle-free and quicker access to auto loans. Customers already making installment payments for their cars can apply for the “Car to Cash-Balance Transfer” at any KBank branch to receive increased loan limit and lower installment payment, thus reducing their monthly debt burden.
According to KResearch, the Car to Cash and pre-owned car markets will continue to see growth on top of 2021 figures, due to positive factors in support of both supply and demand. Not only has there been a rise in the number of repossessed cars in the market, the purchasing power of some Thais has decreased, making it difficult for them to purchase new cars. For customers affected by the ongoing COVID-19 situation, KLeasing plans to introduce a relief program in the form of assistance measures and Car to Cash loan in order to alleviate their burden and allow them to extend their debt repayment period. This will ensure that customers will be able to service their debt while also owning a car to help them earn their living.
Tirachart said in closing that, from the second quarter of 2022 onwards, KLeasing will press ahead with launches of new products and services that continually meet customers’ demands. The company is also ready to launch a credit analysis scheme via a new credit scoring platform, as well as digital channels that will enable easier and faster loan approval for KBank’s large customer base.