Thailand production slump threatens Japanese automakers

[webfact]

Thailand production slump threatens Japanese automakers

Output declines for 4 straight months through August as regional market sputters

YOHEI MURAMATSU, Nikkei staff writer

 

Workers at a Toyota plant in Thailand assemble pickup trucks.   © Reuters

 

BANGKOK -- Thailand's automobile output shrank for four straight months through August, an industry group reported Tuesday, as a result of weakened domestic spending and downward pressure on exports that could spell trouble for Japanese automakers.

 

Overall auto production last month shrank 8% on the year to 166,361, the Federation of Thai Industries reported. This follows data from June that shows auto purchases dipped below the year-earlier number for the first time in 30 months. Sales in July receded by 1%.

 

This pattern mirrors declines in sales seen across Southeast Asia. The slower production is especially problematic to Japanese automakers, which count Thailand as the biggest manufacturing center in Southeast Asia.

 

Full story: https://asia.nikkei.com/Business/Automobile/Thailand-production-slump-threatens-Japanese-automakers

 

-- NIKKEI ASIAN REVIEW 2019-09-18

[keith101]

If the BOT where to drop their rate from 1.5% to 1.0% or 1.25% it would make a big difference to the Thai economy and a resurgence in exports which is what a lot of countries are doing to revive their economies basically brought on by Trumps retarded trade war with China .

[boonrawdcnx]

Who wants to buy their overpriced substandard cars unless one has to?

 

We used to buy a new car here every 3 years but it’s like throwing money out the window.

 

The last Camry we bought was 1.6 million here - in the US the same car sold for around 26.000 US $!

Safety standards are so low in this country that they only provide what they have to for the domestic market which should make cars cheaper here. Also I hear that the chassis for the local market is a lower grade than the one for export.

 

 

 

 

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[overherebc]

2 minutes ago, boonrawdcnx said:

Who wants to buy their overpriced substandard cars unless one has to?


Sent from my iPhone using Thaivisa Connect

They are luxury prestige cars for goodness sake.

[Cadbury]

1 hour ago, keith101 said:

If the BOT where to drop their rate from 1.5% to 1.0% or 1.25% it would make a big difference to the Thai economy and a resurgence in exports which is what a lot of countries are doing to revive their economies basically brought on by Trumps retarded trade war with China .

So it's all Trump's fault? What about the baht factor? Surely that must come into play somewhere.

The Japanese will not put up with situation for long. A pull out and transference of production to a lower cost country could well be on the cards. The bell is tolling for Thailand!

 

[JoePai]

Lower output is the same throughout the world, not just Thailand/Asia

[MadMac]

1 hour ago, keith101 said:

If the BOT where to drop their rate from 1.5% to 1.0% or 1.25% it would make a big difference to the Thai economy and a resurgence in exports which is what a lot of countries are doing to revive their economies basically brought on by Trumps retarded trade war with China .

No, it would make no difference at all as the intended devaluation of not only westen currencies, aka quantitative easing goes on. Europe just started printing fresh money in full force. The FED will follow anytime soon. It's a death spiral for central banks as national debt cannot be repaid. Thailand does not have uncontrollable debt. So they are better off to stay away from following the west being sucked in the next recession black hole.

[Eric Loh]

24 minutes ago, MadMac said:

No, it would make no difference at all as the intended devaluation of not only westen currencies, aka quantitative easing goes on. Europe just started printing fresh money in full force. The FED will follow anytime soon. It's a death spiral for central banks as national debt cannot be repaid. Thailand does not have uncontrollable debt. So they are better off to stay away from following the west being sucked in the next recession black hole.

Can't help thinking the irony of the World Bank looking the other way when the EU and USA print money to stimulate their economies when both economies are eyeball in debts and weak balance sheets. I remember the '97 Tom Yam Kong financial crisis when affected countries asked to print money but World Bank refused and forced them to take big loans and big re-structuring reforms. In the end, it turn up as blessings for Asian economies as they are now stronger than the western economies. 

[smedly]

if you go back these last 3 months there is a lot of separate but connected data emerging about the state of the Thai economy, all you have to do is join the dots 

[natway09]

This article does not make a lot of sense. Japanese automakers in Thailand have never relied on domestic consumption but helped. Anyone with any nouse would have known that Thailand's 

domestic sales have reached a semi saturation level.....just ask the finance companies

Now the export market is feeling the same pressure & so EXPORT orders are not up to expectations

[weegee]

6 hours ago, Cadbury said:

So it's all Trump's fault? What about the baht factor? Surely that must come into play somewhere.

The Japanese will not put up with situation for long. A pull out and transference of production to a lower cost country could well be on the cards. The bell is tolling for Thailand!

 

Havent the Japanese been quietly making the plans to move for a few years now? Building Large Factories in countries other than Thailand?....

[hotchilli]

10 hours ago, webfact said:

This pattern mirrors declines in sales seen across Southeast Asia. The slower production is especially problematic to Japanese automakers, which count Thailand as the biggest manufacturing center in Southeast Asia.

 

Watch out for the first Japanese auto maker to cut it's losses either by radically cutting Thai production or moving production to somewhere where profits can be made.

Then the landslide will follow.

[Sir Dude]

What the Thais need to remember is that eventually there comes a tipping point for international corporations where it is cheaper to move and set up in the next place that offers cheap labour and security. Same thing is happening in China now as the Chinese government knows the writing is on the wall and hence why they are trying to shift their economy to a consumption/invention and service based one rather than just exports, as after a while workers want more and more plus other factors. Thailand is in danger of making itself unattractive to business due to high value currency, work force that isn't skilled properly and numerous other draconian things that damage it on several fronts. 

[Pedrogaz]

So tourism is down, cars sales are down.....but the economy is doing really really well. I think Prayut has caught the lack of reality disease from his visit to Trump.

[ChrisY1]

11 hours ago, Eric Loh said:

Can't help thinking the irony of the World Bank looking the other way when the EU and USA print money to stimulate their economies when both economies are eyeball in debts and weak balance sheets. I remember the '97 Tom Yam Kong financial crisis when affected countries asked to print money but World Bank refused and forced them to take big loans and big re-structuring reforms. In the end, it turn up as blessings for Asian economies as they are now stronger than the western economies. 

Do you Thailand is printing?

[Isaan sailor]

So obvious why numbers down—hot money inflows at BoT push up the Baht for two years now,   You will pay for this nonsense, Thailand...

[asean]

Interesting that the Jap car makers are slumping. Maybe just saturation. At the other end Benz Thailand is having a bumper year this year. Sold 3,400 cars at the last BKK motorshow. They manufacture and sell more than 15,000 cars a year here oddly enough at a higher cost per unit than in Germany.

[Chazar]

Japanese  renters  working for Toyota HATE  your  TM30..............source,  Wife  has to find Toyota rooms for their staff from overseas.

[MadMac]

Thought Toyota is already moving production to Malaysia, that was some time last year. What happened to that?

[CLS]

Thailand is now too expensive for low skilled workers.
Raising the minimum wages works only if you increase productivity too.



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[blackcab]

A troll post has been removed.

[keith101]

On 9/18/2019 at 9:18 AM, boonrawdcnx said:

Who wants to buy their overpriced substandard cars unless one has to?

I have a 2017 Toyota revo (bought new ) and its an excellent vehicle and is not substandard at all .