The automotive industry was a major engine driving Thailand’s Manufacturing Production Index by 24.1 per cent in the first half of this year.

Originally posted here:
Auto manufacturing pushes up capacity utilisation

With the production of 769,082 units, the auto manufacturing increased 97.66 per cent on year, according to the Industrial Economics Office. The office expected the auto production to reach 830,000 units in the second half, up 36 per cent on year.

Sutthinee Phupaka, director-general of the office, said that in the first half, capacity utilisation averaged 62.9 per cent, and utilisation rate in several industries is so high that they need to invest more on machinery and equipment or they may fail to catch up with higher demand.

gm plant thailand
In June alone, the index rose 14.34 per cent while capacity utilisation was at 65.6 per cent.

The office thus expected the annualized MPI to expand 15-16 per cent this year, which doubles from the estimate early this year, she said.

Aside from the automotive, electrical appliance and electronics and the textiles and garment industries also showed impressive growth from the same period last year.

Output from the electrical appliance and electronics industry increased 36.55 per cent, due mainly to the increasing demand in hard-disk drive as well as the low base. The index should increase 9.07 per cent in the latter half.

The textile and garment industry’s output also rose thanks to free trade agreements, and it should increase 3-7 per cent in the latter half.

Thailand is well on the way to achieving performance goals set by the Thai government in a master plan formulated in the past decade for the automotive industry’s development. This includes substantial progress toward becoming Asia’s automotive production base, gaining global competitiveness, reaching output targets for passenger cars, pickup trucks and motorcycles, and achieving international recognition as a center for replacement equipment manufacturing or REM parts.

Automotive giant Ford Motor Company, already a major investor in Thailand, now sees the country as an even more crucial part of its future success. In June, Ford announced a 15 billion baht (US$450 million) investment to build a 750,000sqm state-of- the-art passenger car plant in Rayong province. The factory is scheduled to start production in 2012, with an initial capacity of 150,000 units.

The plant represents another big stride under the company’s aggressive expansion in the Asia-Pacific region, which is projected to account for 40% of global auto industry growth in the decade ahead. Besides building the next-generation Ford Focus for Thailand and neighboring markets, the highly flexible factory will be capable of manufacturing a range of other vehicles in the future.

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