The final months of the year are usually when businesses expect higher local spending, riding on the festive New Year mood.
But given sluggish domestic purchasing power all year, the private sector may remain glum this month even as it pushes to avoid a slowdown in GDP growth, with the southern floods sidelining the regional economy for at least a month during recovery.
The government is accelerating flood recovery efforts and rolling out stimulus measures, including tax deductions for travel and dining, as well as the second phase of the “Khon La Khrueng” co-payment programme. Meanwhile, businesses are preparing for the year-end with a broad range of marketing activities to spur consumption.
GLOOMY DECEMBER
December is often filled with bustling economic activities, driven by the festive mood of the final month, but only a handful of industries have managed to increase sales before the new year, said Apichit Prasoprat, vice-chairman of the Federation of Thai Industries (FTI).
He described the fourth quarter of 2025 as a “tough period”, worsened by the devastating floods in the South that threaten to slow the nation’s full-year economic growth.
“Though businesses are trying to adapt to the situation, not all of them see a light that will guide them to a healthy recovery,” said Mr Apichit recently after the Joint Standing Committee on Commerce, Industry and Banking revised its GDP growth projection for this year to 2%, from a range of 1.8-2.2%.
He said car production is among a small number of industries that can survive unpleasant economic circumstances, thanks to the ongoing Thailand International Motor Expo 2025, which runs until Dec 10.
Many car companies hope the 12-day event will encourage people to buy more cars, even though households remain cautious about spending, said Mr Apichit.
“Car companies are taking this opportunity to lift sales through new marketing campaigns,” he said.
The expo is expected to generate 55 billion baht in economic value, with electric vehicles (EVs) and new car models attracting prospective buyers, according to organisers.
However, with banks keeping strict criteria for auto loans amid high levels of household debt and weak purchasing power, a year-on-year increase in car bookings during the event seems unlikely.
Kwanchai Paphatphong, chairman of the expo’s organising committee, said he expects car bookings during the event to remain flat compared with last year, which recorded 62,459 bookings.
Other industries posted declining purchase orders, resulting in lower manufacturing, said Mr Apichit, as Thailand’s Manufacturing Industry Index fell to 94.6 points in October.
“We have to be more self-reliant because we know the government already carried out most available measures to the fullest extent,” he said.
Kessara Thanyalakpark, managing director of SET-listed Sena Development, said the final month of the year is normally a quiet period for housing sales, as the long holiday stretch prompts many people to travel.
“December is expected to remain subdued as the housing market has slowed due to the weak economy and high level of mortgage rejections. As a result, we are not introducing any special promotions or strategies for homebuyers in the final stretch of the year,” she said.
However, some developers have rolled out discounts and promotional campaigns as they face liquidity constraints and need to generate cash flow. Some are even willing to sacrifice profit margins to preserve their financial position.
Ms Kessara said Sena continues to offer rent-to-own programmes, as it has over the past year, to support homebuyers who are likely to qualify for a mortgage in the future, but are unable to secure financing today.
This allows them to access homeownership when their financial situation improves, she said.
CONFIDENCE IS KEY
Voralak Tulaphorn, chief marketing officer at The Mall Group, said the key to economic stimulus during the year-end is confidence.
“When consumers believe they will receive tangible returns on their purchases, they are decisive buyers. This creates widespread positive effects across the retail sector,” she said.
During the year-end, consumer spending typically increases, said Ms Voralak.
Any government initiatives aimed at reducing the cost of living and increasing consumer spending confidence can enhance this trend and stimulate economic circulation.
She said the “Tiew Dee Mee Kuen” tax deduction is a good example of an effective policy that allows consumers to deduct food and dining expenses from their income taxes. This immediately increases sales at restaurants and service providers in malls and provides clear benefits to consumers.
Ms Voralak said the most effective current strategy for malls may be experience-led spending, which focuses on delivering value that consumers can appreciate.
“Today’s shoppers are looking for more than just discounts — they want enjoyable experiences and real value. Our marketing campaigns, combined with the Tiew Dee Mee Kuen initiative, are helping consumers make easier spending decisions. This strategy is proving to be more sustainable than one-time discount offers,” she said.
The Mall Group encourages families and friends to connect while stimulating diverse spending across categories, said Ms Voralak.
The company is enhancing customer experiences by offering privileges in collaboration with financial institutions, including immediate, usable points and cashback.
This makes shoppers feel they are receiving exceptional value in terms of experiences and rewards during the year-end season, she said.
DISCOUNT WON’T WORK
Chaiyaphat Wasoonthara, president of the Krabi Tourism Association, said tourism operators are avoiding heavy discounts, instead offering extra perks such as add-on activities or products to maintain costs while attracting high-spending travellers.
To increase year-end travel spending, Mr Chaiyaphat said authorities and operators are focusing on hosting and joining events in the province, such as the Krabi Rewild Festival between Dec 5-7.
Earlier this year, the association projected stronger tourism growth in Krabi, but the sector has faced multiple challenges including declining confidence in travel safety among foreign visitors, especially from China. Before the pandemic, the province had direct flights from China, but they have yet to resume.
He said the recent severe flooding in Songkhla and nearby southern provinces will also affect Krabi’s tourism in the coming months.
Many Malaysian tourists usually drive through Hat Yai to visit Krabi, but they may now avoid the trip because of the floods.
Local visitors from Songkhla are also expected to dip as they face economic strain from the disaster.
Domestic tourism during the December holidays remains flat, weighed down by weak spending, with the total performance predicted to remain steady compared with last year, said Mr Chaiyaphat.
Domestic airfares to Krabi have increased, but he said the impact on sentiment has been limited as foreign demand remains strong, resulting in high load factors.
Krabi expects a minimum 80% average occupancy rate this high season, driven by growth from international markets led by Scandinavia and the Middle East, which book trips 3-6 months in advance, said Mr Chaiyaphat.
ADDITIONAL STIMULUS
Sanan Angubolkul, president of Srithai Superware Group, said the economy is highly volatile this year. He said the government’s “Quick Big Win” initiatives and stimulus measures have been appropriately timed, strengthening consumer confidence.
Mr Sanan said the private sector is hopeful the government will continue to implement additional stimulus programmes to lift tourism and domestic consumption, as well as support small and medium-sized enterprises.
These efforts should increase monetary flow, contributing to a more vibrant economy during the year-end, particularly within the tourism sector, he said.
“Restoring confidence in travel during the peak season can significantly help the economy,” said Mr Sanan.
Entrepreneurs are gearing up for the New Year festival with various sales and marketing campaigns to enhance demand, such as gifts and promotions to increase value for consumers, he said.
Some discounts are intended to alleviate living costs while also reducing inventory, said Mr Sanan.
Essential consumer products and items for vehicle and home repairs are available at discount prices to support flood victims during the recovery period.
Provided by SyndiGate Media Inc. (Syndigate.info).
