BANGKOK - Thailand's domestic car sales tumbled 38.8% in August from a year earlier as stricter coronavirus containment measures hit economic activity, the Federation of Thai Industries (FTI) said on Thursday.

However, the curbs, imposed in July and August, have been eased from this month, which the FTI said should boost car sales later this year.

In August, sales dropped to 42,176 vehicles, the lowest level in 15 months, after July's 11.6% year-on-year fall to 52,442 units, the FTI said.

A microchips shortage also slowed car production, it said.

Thailand is a regional vehicle production and export base for the world's top carmakers, including Honda, Toyota, Mitsubishi and Nissan.

The FTI is maintaining its targets for domestic car sales of 750,000 units and auto exports of 800,000 to 850,000 cars this year.

A motor expo in December will also help boost sales this year, Surapong Paisitpattanapong, a spokesperson for FTI's automotive industry division told a briefing.

"After the lockdown relaxation, clients began to visit showrooms. Auto centres are back to normal," he said.

"Consumer confidence is important. If government measures can build people's confidence, spending will return," he added.

In August, car exports rose 3.78% from a year earlier to 59,571 units, a four-month low, due to delayed production of some models caused by semiconductors and parts shortages as well as outbreaks at some factories.

"If the shortages and the COVID situation ease later this year, our export target should be met," Surapong said.

(Reporting by Satawasin Staporncharnchai and Kitiphong Thaichareon Writing by Orathai Sriring; Editing by Martin Petty) ((orathai.sriring@tr.com;))