Thailand’s vehicle exports look unfavourable next year
Written by Writer on Monday, October 6th, 2008
Thailand’s vehicle exports look unfavourable next year : KRC
BANGKOK, Oct 6 (TNA) - Thailand’s vehicle exports look unfavourable in the coming year as they are likely to experience risk factors from the global economic slowdown arising from the US financial crisis and the continued fluctuation of oil prices, according to Kasikorn Research Center.
The leading think tank projected the country’s vehicle exports would grow around 8 per cent in terms of volume next year compared with 14 per cent expected for this year.
The export value is forecast to expand about 9.9 per cent this year versus the17 per cent earlier projected for this year.
The expected decline in exports might dampen the government’s ambition to boost annual vehicle production to 2 million units in 2011 under the second-phase auto industry master plan (2007-2011).
KRC advised entrepreneurs in the auto industry to adjust of their own accord in the face of the US financial meltdown since the crisis could affect the currency exchange rate and production costs of some kinds of raw materials such as oil and steel.
What the entrepreneurs should do to control their costs is to hedge against the currency exchange risks and closely monitor oil and steel prices in the global market.
They should also attempt to diversify risks from the global economic slowdown by counting on the free trade area (FTA) agreements Thailand had made with many countries to expand trade with them and seeking new export destinations with growth potential.
Due to the global economic sluggishness, KRC said the entrepreneurs might be unable to raise their product prices in the long run.
So, they should try to reduce production costs by enhancing their competitiveness through investment in production technology, establishing a research and development centre, strengthening the local auto industry network, and development of human resources.
KRC added the Thai government needs to prepare an auto industry promotion plan together with the energy consumption scheme in the long term to give investors a clear direction on implementing its investment projects such as eco-car production, manufacturing vehicles powered by natural gas for vehicles (NGV) and E85 gasohol.
In the first eight months of this year, Thailand produced 944,893 vehicles, up 15.8 per cent from the same period last year.
Of this, 529,530 units are for export and 415,363 units for local sales.
The country’s imports of vehicles in the period amounted US$627.7 million, up 56.8 per cent from the corresponding period the year before. (TNA)
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