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Friday, October 14, 2011

Car production bases to remain in Thailand despite floods

Car production bases to remain in Thailand despite floods


(picture source AFP)

BANGKOK: Despite the floods, car makers will not shift their production bases from Thailand but will only suspend production due to the shortage of auto parts, Thai News Agency (TNA) reported.

Piangjai Kaewsuwan, president of the Thai Automotive Industry Association, said on Thursday although industrial estates in Ayutthaya province were flooded and automobile and auto parts manufacturers affected, the floods should not prompt car-making companies to move their production bases from Thailand because it was a temporary natural disaster.

Piangjai, however, said she expected the supply of auto parts to drop by 10-20 percent.

She added that the Thai automotive industry should take at least three months to recover and that the actual automobile production should reach at least 1.5 million units this year instead of the annual production target of 1.8 million vehicles.

Toyota, Ford, Nissan and Isuzu companies have so far suspended their production for two days to assess the situation, saying they may source auto parts from China and India instead.

Meanwhile, Anuparp Tadpitakkul, state affairs director of Ford Operations (Thailand) Co, said the company suspended its production for two days to examine its stocks of parts as seven plants were affected.

However, he said he did not think the floods will have an impact on the long-term investment of the company in Thailand.

Some 10 Malaysian companies have been found affected by the severe flooding.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed said most of them were involved in the automotive and electrical and electronic sectors.

"Those who are affected operate in the flooded Ban Wa, Rojana and Navanakorn industrial parks," he told reporters after the ministry's monthly assembly in Kuala Lumpur today.

The Thai News Agency reported Deputy Prime Minister Kittirat Na-Ranong as saying that the ongoing flood crisis could reduce the country's GDP growth by at least 0.6-0.9 per cent due to expanding damage to its farm and industrial sectors.

 -Bernama(Photo by AFP)

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