Honda sales in Thailand dropped by 14.9% to 25,028 units in the first quarter of the year, but the company is positive that domestic sales will hit 110,000 units this year, the Bangkok Post reports. The sluggish local market will be balanced by strong exports. Thai-based Asian Honda Motor Co, in charge of Honda’s exports from Thailand, expects to ship 76,000 completely built-up (CBU) units this year, from 71,000 last year.

“Honda is quite optimistic about the international market, where it focuses mainly on Asia, Oceania, the Middle East and Africa, but it is also concerned about the global economy as well,” said COO Pitak Pruittisarikorn.

Exports from Thailand have been on an uptrend. Last year, Honda’s total automobile exports from the Land of Smiles reached 83.1 billion baht in value, up 19% from 2014. Of that, CBU exports increased by 44% in value to 37.9 billion baht, driven by strong demand from countries such as Australia and Mexico. The City sedan and HR-V/CR-V SUV duo accounted for 70% of CBU exports.

On the completely knocked-down (CKD) front, exports rose by 5% in value to 40.4 billion baht in 2015. Shipments of parts and accessories rose by 30% in value to 3.4 billion baht thanks to increased demand from Malaysia, Australia and India.

Thailand has been a major hub for Honda, even before the opening of the new Prachinburi plant that was officiated last week. With the high-tech tenth-gen Civic-producing factory on board, Thailand has the capacity to produce 420,000 units a year, making it the fourth largest base for Honda after Japan, US and China.

A slowing Thai market with production numbers propped up by growing exports is a general trend that has been reported before. New car sales were down by 8.3% to 181,318 units in Q1, as heavily indebted Thai consumers held back on big ticket items. Prices of cars have gone up too, as a result of a new excise tax that takes into consideration C02 emissions and E85 biofuel capability, as opposed to solely engine capacity.

A fourth consecutive year of decline in Thai car sales this year is predicted, with figures forecasted to fall by 5-6% to 750,000 units. Check out the ASEAN automotive market report for the first quarter, which shows a 3.6% drop in Q1 2016 for our region.