Section 3. Expansion of Asian Markets and Developments in Oceania
Item 1. From Stagnation to Growth
Asian currency crisis
The Asian currency crisis that occurred following the plunge in the value of the Thai Baht in July 1997 quickly rippled out to neighboring countries, and national economies began shrinking. The automotive markets of member countries of the Association of Southeast Asian Nations (ASEAN) dropped sharply in 1998; Thailand was down approximately 24 percent and the Philippines down approximately 50 percent from each country's respective peaks in 1996, and Indonesia was down approximately 15 percent and Malaysia down approximately 41 percent from their peaks in 1997.1
From immediately after the currency crisis until the end of 2000, TMC progressively raised the retail prices of its cars to secure income and supported sales promotion measures by distributors in various countries, such as low-interest campaigns, as well as campaigns to draw more customers into service shops with limited-period discounting of parts. TMC also bolstered its financial status by increasing its investment in affiliates in the seven ASEAN member countries.
Following the Asian currency crisis, national economies began recovering after bottoming out in 1998, but interest rates remained high with the aim of stabilizing currencies, and automotive markets continued to slump. However, total demand in Thailand, Indonesia, Malaysia, and the Philippines set a record of 1.4 million units in 2001, and in the following year total demand reached 1.68 million units, surpassing the pre-crisis peak of 1.44 million units in 1996.