Thailand's War With The Uk

[draftvader]

This thread has legs. Whatever we all think of the opening post you have to admit that it has fire a HUGE debate that has, unbelievably, stayed on topic pretty well.

My biggest bug in all this, the one that sits under my skin and I just can't scratch is this.

How much of this success in Thailand's motor industry compared to GDP (/capita) is at the expense of the lowest wage earners and the intellectual/educational progress of this nation as a whole? Whilst Thailand's general education keeps people in the lowest wage earning zone this human resource rich market will always survive, but what does that do for the general populous? I have to admire this control for the growth of the nation, but growth of the people? Whilst Thailand needs to exploit the low wage earners to create an economy it will never be in the interest of the common man but only for the interest of the few.

[chiangmaikelly]

I always assumed that the auto manufacturers in Thailand did not actually need the tariffs to compete in the free market, they just like having them because it allows them to overcharge the public and the government officials get a kick back. Is this not the case?

It would be interesting to see what portion/value of the parts are sourced in Thailand and how much comes from overseas and thus has an import duty applied to it. If most of these parts are fabricated in Thailand then someone is clearly making huge profits somewhere.

As an example, the new BMW 520i appears to retail at about 1.6m baht at current exchange rates in UK/Germany however the Thai version retails here at 3.6m baht.

Ford sources 40% of the parts locally. Clearly the factories and Thai people who make the parts are doing quite well. As to are they making huge profits? I don't know. I would think Ford bids out the contracts.

[chiangmaikelly]

I guess for some the comparison between Western and Thai technical skills is hard to fathom. I am waiting for the results of an ASME Boiler and Pressure Vessel Code inspection right now.

I guess that's a Thai vessel code ... Perhaps the Ayutthaya Society of Mechanical Engineers.

I trust you aren't applying an imported engineering code here CMK?

I realize irony is difficult for some people to deal with but I was pointing out it is ironic that an American code was being applied with no Americans present. Industry has moved far beyond national borders.

[chiangmaikelly]

This thread has legs. Whatever we all think of the opening post you have to admit that it has fire a HUGE debate that has, unbelievably, stayed on topic pretty well.

My biggest bug in all this, the one that sits under my skin and I just can't scratch is this.

How much of this success in Thailand's motor industry compared to GDP (/capita) is at the expense of the lowest wage earners and the intellectual/educational progress of this nation as a whole? Whilst Thailand's general education keeps people in the lowest wage earning zone this human resource rich market will always survive, but what does that do for the general populous? I have to admire this control for the growth of the nation, but growth of the people? Whilst Thailand needs to exploit the low wage earners to create an economy it will never be in the interest of the common man but only for the interest of the few.

Import taxes and tariffs and not the same as subsidies. For example Australia pays auto companies to make cars and the US pays farmers not to grow crops. In both of these cases tax dollars are going to rich people. In Thailand import taxes go not to the car company but the government. Some posters are trying to make a connection between import duties and export sales of autos which in my opinion is tenuous at best.

[StreetCowboy]

This thread has legs. Whatever we all think of the opening post you have to admit that it has fire a HUGE debate that has, unbelievably, stayed on topic pretty well.

My biggest bug in all this, the one that sits under my skin and I just can't scratch is this.

How much of this success in Thailand's motor industry compared to GDP (/capita) is at the expense of the lowest wage earners and the intellectual/educational progress of this nation as a whole? Whilst Thailand's general education keeps people in the lowest wage earning zone this human resource rich market will always survive, but what does that do for the general populous? I have to admire this control for the growth of the nation, but growth of the people? Whilst Thailand needs to exploit the low wage earners to create an economy it will never be in the interest of the common man but only for the interest of the few.

Import taxes and tariffs and not the same as subsidies. For example Australia pays auto companies to make cars and the US pays farmers not to grow crops. In both of these cases tax dollars are going to rich people. In Thailand import taxes go not to the car company but the government. Some posters are trying to make a connection between import duties and export sales of autos which in my opinion is tenuous at best.

I'm not sure to what extent Thailand gives credit for offset or reciprocal trade flows, so for example, if I build twice as many pickups as I need in Thailand, I can export half of them and bring in some saloon cars subject to duty as if they had been made in Thailand, or subject to some reduction in the import tariffs.

Notwithstanding that, when a Japanese manufacturer decides to address the Thai market, so to be competitive he has to build a plant here. Now he could build two plants, one here and one in an efficient production country to address the demands of other countries. But it is cost-effective to build a single larger plant to fulfil all the need for a specific model, and then export from Thailand to third countries. Or even back home to Japan, if Japanese capacity is full.

Because they can sell the locally manufactured cars at a high premium (thanks to an inflated car market due to barriers to imports) to cover the fixed costs of the plant, the export vehicles can be sold to other subsidiaries at a price based on avoidable cost, not full cost. Profits are thus repatriated from the investment not as cash but as underpriced vehicles.

Personally, I find such practices irritating and obfuscatory, but unfortunately sometimes we have to find the best way to go over or round the hurdles that people put in our way.

SC

[chiangmaikelly]

This thread has legs. Whatever we all think of the opening post you have to admit that it has fire a HUGE debate that has, unbelievably, stayed on topic pretty well.

My biggest bug in all this, the one that sits under my skin and I just can't scratch is this.

How much of this success in Thailand's motor industry compared to GDP (/capita) is at the expense of the lowest wage earners and the intellectual/educational progress of this nation as a whole? Whilst Thailand's general education keeps people in the lowest wage earning zone this human resource rich market will always survive, but what does that do for the general populous? I have to admire this control for the growth of the nation, but growth of the people? Whilst Thailand needs to exploit the low wage earners to create an economy it will never be in the interest of the common man but only for the interest of the few.

Import taxes and tariffs and not the same as subsidies. For example Australia pays auto companies to make cars and the US pays farmers not to grow crops. In both of these cases tax dollars are going to rich people. In Thailand import taxes go not to the car company but the government. Some posters are trying to make a connection between import duties and export sales of autos which in my opinion is tenuous at best.

I'm not sure to what extent Thailand gives credit for offset or reciprocal trade flows, so for example, if I build twice as many pickups as I need in Thailand, I can export half of them and bring in some saloon cars subject to duty as if they had been made in Thailand, or subject to some reduction in the import tariffs.

Notwithstanding that, when a Japanese manufacturer decides to address the Thai market, so to be competitive he has to build a plant here. Now he could build two plants, one here and one in an efficient production country to address the demands of other countries. But it is cost-effective to build a single larger plant to fulfil all the need for a specific model, and then export from Thailand to third countries. Or even back home to Japan, if Japanese capacity is full.

Because they can sell the locally manufactured cars at a high premium (thanks to an inflated car market due to barriers to imports) to cover the fixed costs of the plant, the export vehicles can be sold to other subsidiaries at a price based on avoidable cost, not full cost. Profits are thus repatriated from the investment not as cash but as underpriced vehicles.

Personally, I find such practices irritating and obfuscatory, but unfortunately sometimes we have to find the best way to go over or round the hurdles that people put in our way.

SC

Perhaps you could explain the difference between the above and Australian subsidies?

[samran]

I doubt if GH can or will answer this question. Perhaps if you explained it in more basic terms. For example,"A HOLDEN Commodore SS Series 2 sells for $41,990. But strip away the government assistance and the same car could easily have a price tag of more than $50,000. Under the system of tariffs on imported cars and hefty subsidies for the local industry, car buyers are effectively paying twice. At an average price of $25,000, that means a subsidy of nearly 30 per cent of the price of an Australian car.

Steve Keen, a professor in economics at the University of Western Sydney, believes arguments for free trade ''are shot through with holes''. ''Every country that has successfully industrialised has done so with some involvement of government policy and by favouring local manufacturing,'' he said.

http://www.smh.com.a...0211-1syck.html

Having actually read the article, you are misrepresenting it by selectively quoting it.

I occasionally follow the work of Steve Keen, and quoting him selectively like you have gives the wrong impression.

What you fail to also quote is what he says next:

"He believes the government should stop supporting ''multinational corporations that call themselves local'' and invest more in innovation, ''in particular green alternatives to the motor car''.

''Why don't we show a bit of courage and give something like that a go rather than throwing money down the gurgler of V8s?'"

ps...I don't think GH needs my help in defending him, but your condescending little remark:

I doubt if GH can or will answer this question. Perhaps if you explained it in more basic terms

well, CMT: GH is wiping the floor with you so I wouldn't try and sound too smart if I were you.....

[chiangmaikelly]

I doubt if GH can or will answer this question. Perhaps if you explained it in more basic terms. For example,"A HOLDEN Commodore SS Series 2 sells for $41,990. But strip away the government assistance and the same car could easily have a price tag of more than $50,000. Under the system of tariffs on imported cars and hefty subsidies for the local industry, car buyers are effectively paying twice. At an average price of $25,000, that means a subsidy of nearly 30 per cent of the price of an Australian car.

Steve Keen, a professor in economics at the University of Western Sydney, believes arguments for free trade ''are shot through with holes''. ''Every country that has successfully industrialised has done so with some involvement of government policy and by favouring local manufacturing,'' he said.

http://www.smh.com.a...0211-1syck.html

Having actually read the article, you are misrepresenting it by selectively quoting it.

I occasionally follow the work of Steve Keen, and quoting him selectively like you have gives the wrong impression.

What you fail to also quote is what he says next:

"He believes the government should stop supporting ''multinational corporations that call themselves local'' and invest more in innovation, ''in particular green alternatives to the motor car''.

''Why don't we show a bit of courage and give something like that a go rather than throwing money down the gurgler of V8s?'"

ps...I don't think GH needs my help in defending him, but your condescending little remark:

I doubt if GH can or will answer this question. Perhaps if you explained it in more basic terms

well, CMT: GH is wiping the floor with you so I wouldn't try and sound too smart if I were you.....

I didn't misrepresent the article at all. Your snide comments only reinforce your personal agenda. Try the subject matter of the article, "

Under the system of tariffs on imported cars and hefty subsidies for the local industry, car buyers are effectively paying twice. You pay for it out of your taxes and then you pay the full price. Doesn't sound like a very good deal to me,'' he said. In 2009-10, the industry produced more than 231,000 cars. In that time, total government assistance, including subsidies, tax breaks and tariffs, was $1.625 billion.

The name of the article is , " Crunch time for Australia's car makers." I would quote the whole thing if I could but it is against TV policy.

The point I was trying to make, which you miss, has nothing to do with multinational corporations which call themselves local, it has to do with the difference between an import duty and a subsidy.

BTW what is the argument GH is winning? Bet you don't know.

Edited October 19, 2012 by chiangmaikelly

[GuestHouse]

]I realize irony is difficult for some people to deal with but I was pointing out it is ironic that an American code was being applied with no Americans present. Industry has moved far beyond national borders. [/size]

In the context of your Opening Post in which you refer to Superior Thai Engineering the irony is you now giving Thais applying foreign engineering codes as an example of what I can't figure.

Had you given us an example of Thai engineering codes being applied overseas I would have been impressed with both an example of Thai Engineering expertese AND the Internationalization of Engineering not just being a one way street.

[samran]

The point I was trying to make, which you miss, has nothing to do with multinational corporations which call themselves local, it has to do with the difference between an import duty and a subsidy.

To be honest I don't know what point you are trying to make.

And it is bit hard for me to 'miss' the difference between import duties and subsidies - as I've been talking about all along. Afterall, tax breaks and holidays, which are core to BOI incentives, are effective subsidies anyway.

[chiangmaikelly]

]I realize irony is difficult for some people to deal with but I was pointing out it is ironic that an American code was being applied with no Americans present. Industry has moved far beyond national borders. [/size]

In the context of your Opening Post in which you refer to Superior Thai Engineering the irony is you now giving Thais applying foreign engineering codes as an example of what I can't figure.

Had you given us an example of Thai engineering codes being applied overseas I would have been impressed with both an example of Thai Engineering expertese AND the Internationalization of Engineering not just being a one way street.

I wrote "I guess for some the comparison between Western and Thai technical skills is hard to fathom. I am waiting for the results of an ASME Boiler and Pressure Vessel Code inspection right now. The point I was making by the above post was some people have a difficult time understanding that Thai engineers can deal with and do every day the same codes that are in effect in the West.

Your response, “I guess that's a Thai vessel code ... Perhaps the Ayutthaya Society of Mechanical Engineers.” was meant as an anti Thai flame and supposed to be funny.

[chiangmaikelly]

The point I was trying to make, which you miss, has nothing to do with multinational corporations which call themselves local, it has to do with the difference between an import duty and a subsidy.

To be honest I don't know what point you are trying to make.

And it is bit hard for me to 'miss' the difference between import duties and subsidies - as I've been talking about all along. Afterall, tax breaks and holidays, which are core to BOI incentives, are effective subsidies anyway.

The revenue from an import duty goes to the government. The revenue from a subsidy goes to the manufacturer.

BTW still trying to figure out what argument GH is winning?

[StreetCowboy]

This thread has legs. Whatever we all think of the opening post you have to admit that it has fire a HUGE debate that has, unbelievably, stayed on topic pretty well.

My biggest bug in all this, the one that sits under my skin and I just can't scratch is this.

How much of this success in Thailand's motor industry compared to GDP (/capita) is at the expense of the lowest wage earners and the intellectual/educational progress of this nation as a whole? Whilst Thailand's general education keeps people in the lowest wage earning zone this human resource rich market will always survive, but what does that do for the general populous? I have to admire this control for the growth of the nation, but growth of the people? Whilst Thailand needs to exploit the low wage earners to create an economy it will never be in the interest of the common man but only for the interest of the few.

Import taxes and tariffs and not the same as subsidies. For example Australia pays auto companies to make cars and the US pays farmers not to grow crops. In both of these cases tax dollars are going to rich people. In Thailand import taxes go not to the car company but the government. Some posters are trying to make a connection between import duties and export sales of autos which in my opinion is tenuous at best.

I'm not sure to what extent Thailand gives credit for offset or reciprocal trade flows, so for example, if I build twice as many pickups as I need in Thailand, I can export half of them and bring in some saloon cars subject to duty as if they had been made in Thailand, or subject to some reduction in the import tariffs.

Notwithstanding that, when a Japanese manufacturer decides to address the Thai market, so to be competitive he has to build a plant here. Now he could build two plants, one here and one in an efficient production country to address the demands of other countries. But it is cost-effective to build a single larger plant to fulfil all the need for a specific model, and then export from Thailand to third countries. Or even back home to Japan, if Japanese capacity is full.

Because they can sell the locally manufactured cars at a high premium (thanks to an inflated car market due to barriers to imports) to cover the fixed costs of the plant, the export vehicles can be sold to other subsidiaries at a price based on avoidable cost, not full cost. Profits are thus repatriated from the investment not as cash but as underpriced vehicles.

Personally, I find such practices irritating and obfuscatory, but unfortunately sometimes we have to find the best way to go over or round the hurdles that people put in our way.

SC

Perhaps you could explain the difference between the above and Australian subsidies?

Australian subsidies are explicit and transparent. They are the subject of deliberate and explicit government policy.

The Thai consumer does not know how much he is subsidising the export of vehicles to other countries, since it is hidden in the accounting practices of the private (publicly listed) multinationals, and in the murk of their internal transfer pricing.

SC

[samran]

Australian subsidies are explicit and transparent. They are the subject of deliberate and explicit government policy.

The Thai consumer does not know how much he is subsidising the export of vehicles to other countries, since it is hidden in the accounting practices of the private (publicly listed) multinationals, and in the murk of their internal transfer pricing.

SC

Hate to (partially) disagree with you SC.

While the subsidies are generally explicit, they aren't the subject of deliberate and explicit government policy.

They are a function of: how many jobs would otherwise be lost in Victoria and South Australia, how loud the car companies whinge, and how close to an election it is.

To my knowledge Thai auto's don't get any subsidies per.se. They just get extended BOI tax breaks and tax free status being in export zones.

In both cases (Thailand and Australia) the real books are probably as byzantine as each other.

Edited October 19, 2012 by samran

[chiangmaikelly]

Import taxes and tariffs and not the same as subsidies. For example Australia pays auto companies to make cars and the US pays farmers not to grow crops. In both of these cases tax dollars are going to rich people. In Thailand import taxes go not to the car company but the government. Some posters are trying to make a connection between import duties and export sales of autos which in my opinion is tenuous at best.

I'm not sure to what extent Thailand gives credit for offset or reciprocal trade flows, so for example, if I build twice as many pickups as I need in Thailand, I can export half of them and bring in some saloon cars subject to duty as if they had been made in Thailand, or subject to some reduction in the import tariffs.

Notwithstanding that, when a Japanese manufacturer decides to address the Thai market, so to be competitive he has to build a plant here. Now he could build two plants, one here and one in an efficient production country to address the demands of other countries. But it is cost-effective to build a single larger plant to fulfil all the need for a specific model, and then export from Thailand to third countries. Or even back home to Japan, if Japanese capacity is full.

Because they can sell the locally manufactured cars at a high premium (thanks to an inflated car market due to barriers to imports) to cover the fixed costs of the plant, the export vehicles can be sold to other subsidiaries at a price based on avoidable cost, not full cost. Profits are thus repatriated from the investment not as cash but as underpriced vehicles.

Personally, I find such practices irritating and obfuscatory, but unfortunately sometimes we have to find the best way to go over or round the hurdles that people put in our way.

SC

Perhaps you could explain the difference between the above and Australian subsidies?

Australian subsidies are explicit and transparent. They are the subject of deliberate and explicit government policy.

The Thai consumer does not know how much he is subsidising the export of vehicles to other countries, since it is hidden in the accounting practices of the private (publicly listed) multinationals, and in the murk of their internal transfer pricing.

SC

You forgot the most important part. The Aussie car company gets the subsidy. The Thai car company does not get the import tax.

[samran]

You forgot the most important part. The Aussie car company gets the subsidy. The Thai car company does not get the import tax.

Australian subsides are paid out of general revenue. Tariffs on car imports into Australia are nominal, though there are luxury car taxes.

Thai companies don't need to get the import tax. They get BOI incentives.

[chiangmaikelly]

You forgot the most important part. The Aussie car company gets the subsidy. The Thai car company does not get the import tax.

Australian subsides are paid out of general revenue. Tariffs on car imports into Australia are nominal, though there are luxury car taxes.

Thai companies don't need to get the import tax. They get BOI incentives.

Australian subsidies are paid to the car company around 30% of the price of the car. How much are the BOI incentives per car exported?

[StreetCowboy]

...

Australian subsidies are explicit and transparent. They are the subject of deliberate and explicit government policy.

The Thai consumer does not know how much he is subsidising the export of vehicles to other countries, since it is hidden in the accounting practices of the private (publicly listed) multinationals, and in the murk of their internal transfer pricing.

SC

You forgot the most important part. The Aussie car company gets the subsidy. The Thai car company does not get the import tax.

The company manufacturing in Thailand (probably part of a multinational, since there are no indigenous Thai car manufacturers) gets to charge the local consumer far more for the product than the international going competitive price, thus internally cross-subsidising his exports. He is able to do this because the international competition is excluded by very high import tariffs

SC

[chiangmaikelly]

...

Australian subsidies are explicit and transparent. They are the subject of deliberate and explicit government policy.

The Thai consumer does not know how much he is subsidising the export of vehicles to other countries, since it is hidden in the accounting practices of the private (publicly listed) multinationals, and in the murk of their internal transfer pricing.

SC

You forgot the most important part. The Aussie car company gets the subsidy. The Thai car company does not get the import tax.

The company manufacturing in Thailand (probably part of a multinational, since there are no indigenous Thai car manufacturers) gets to charge the local consumer far more for the product than the international going competitive price, thus internally cross-subsidising his exports. He is able to do this because the international competition is excluded by very high import tariffs

SC

Then all the companies that manufacture autos in Thailand must be in on the scam and rip off the customer at the same rate right? You do know this is nonsense right?

Edited October 19, 2012 by chiangmaikelly

[StreetCowboy]

...

Australian subsidies are explicit and transparent. They are the subject of deliberate and explicit government policy.

The Thai consumer does not know how much he is subsidising the export of vehicles to other countries, since it is hidden in the accounting practices of the private (publicly listed) multinationals, and in the murk of their internal transfer pricing.

SC

You forgot the most important part. The Aussie car company gets the subsidy. The Thai car company does not get the import tax.

The company manufacturing in Thailand (probably part of a multinational, since there are no indigenous Thai car manufacturers) gets to charge the local consumer far more for the product than the international going competitive price, thus internally cross-subsidising his exports. He is able to do this because the international competition is excluded by very high import tariffs

SC

Then all the companies that manufacture autos in Thailand must be in on the scam and rip off the customer at the same rate right? You do know this is nonsense right?

I suggest you compare the cost of a new vehicle here with the cost of a new vehicle in the international market place, and the cost of a new vehicle here that was produced in Thailand with one that was imported. I think you'll find that the price difference does not fully reflect the tariff costs.

Manufacturers are, as you say, in competition to charge the highest price that they can, while still shifting their product, and the tariffs prevent foreign manufacturers from interfering in that competition.

SC

EDIT: Price gouging is not a scam, its accepted business practice. Many countries seek to discourage it, and give their consumers a better deal, by removing tariffs, and broadening competition, at the expense of their protected manufacturers. Their manufacturers then have to become fit enough to compete with the imported competition, or release their workforces to seek employement with companies that can compete.

Edited October 19, 2012 by StreetCowboy

[metisdead]

A post has been removed due to possible violation of copyright and non compliance of fair use. It is generally accepted, but not written into law, that quoting the first two or three sentences of an article and giving a link to the source is considered “fair use” and not a violation of copyright.

As it turns out the deleted article was a quoted article from Bangkok Post and not allowed anyway.

[chiangmaikelly]

You forgot the most important part. The Aussie car company gets the subsidy. The Thai car company does not get the import tax.

The company manufacturing in Thailand (probably part of a multinational, since there are no indigenous Thai car manufacturers) gets to charge the local consumer far more for the product than the international going competitive price, thus internally cross-subsidising his exports. He is able to do this because the international competition is excluded by very high import tariffs

SC

Then all the companies that manufacture autos in Thailand must be in on the scam and rip off the customer at the same rate right? You do know this is nonsense right?

I suggest you compare the cost of a new vehicle here with the cost of a new vehicle in the international market place, and the cost of a new vehicle here that was produced in Thailand with one that was imported. I think you'll find that the price difference does not fully reflect the tariff costs.

Manufacturers are, as you say, in competition to charge the highest price that they can, while still shifting their product, and the tariffs prevent foreign manufacturers from interfering in that competition.

SC

EDIT: Price gouging is not a scam, its accepted business practice. Many countries seek to discourage it, and give their consumers a better deal, by removing tariffs, and broadening competition, at the expense of their protected manufacturers. Their manufacturers then have to become fit enough to compete with the imported competition, or release their workforces to seek employement with companies that can compete.

Apparently you know. What cars are made in Thailand that are also made outside of Thailand?

Edit. If cars are too hard you can try motor scooters.

Edited October 19, 2012 by chiangmaikelly

[StreetCowboy]

...

Then all the companies that manufacture autos in Thailand must be in on the scam and rip off the customer at the same rate right? You do know this is nonsense right?

I suggest you compare the cost of a new vehicle here with the cost of a new vehicle in the international market place, and the cost of a new vehicle here that was produced in Thailand with one that was imported. I think you'll find that the price difference does not fully reflect the tariff costs.

Manufacturers are, as you say, in competition to charge the highest price that they can, while still shifting their product, and the tariffs prevent foreign manufacturers from interfering in that competition.

SC

EDIT: Price gouging is not a scam, its accepted business practice. Many countries seek to discourage it, and give their consumers a better deal, by removing tariffs, and broadening competition, at the expense of their protected manufacturers. Their manufacturers then have to become fit enough to compete with the imported competition, or release their workforces to seek employement with companies that can compete.

Apparently you know. What cars are made in Thailand that are also made outside of Thailand?

Edit. If cars are too hard you can try motor scooters.

Pick-up trucks.

Economy saloon cars.

Like the airlines, auto manufacturers operate a confusopoly of options and pricing, but at the end of the day, they are seeking to brand-differentiate basically similar commodities.

I tried to get a price list for a variety of cars of local and overseas manufacture for you, but I couldn't find one in the available time. I suspect dealers in Thailand shy away from publishing prices that would allow comparison

SC

[chiangmaikelly]

...

Then all the companies that manufacture autos in Thailand must be in on the scam and rip off the customer at the same rate right? You do know this is nonsense right?

I suggest you compare the cost of a new vehicle here with the cost of a new vehicle in the international market place, and the cost of a new vehicle here that was produced in Thailand with one that was imported. I think you'll find that the price difference does not fully reflect the tariff costs.

Manufacturers are, as you say, in competition to charge the highest price that they can, while still shifting their product, and the tariffs prevent foreign manufacturers from interfering in that competition.

SC

EDIT: Price gouging is not a scam, its accepted business practice. Many countries seek to discourage it, and give their consumers a better deal, by removing tariffs, and broadening competition, at the expense of their protected manufacturers. Their manufacturers then have to become fit enough to compete with the imported competition, or release their workforces to seek employement with companies that can compete.

Apparently you know. What cars are made in Thailand that are also made outside of Thailand?

Edit. If cars are too hard you can try motor scooters.

Pick-up trucks.

Economy saloon cars.

Like the airlines, auto manufacturers operate a confusopoly of options and pricing, but at the end of the day, they are seeking to brand-differentiate basically similar commodities.

I tried to get a price list for a variety of cars of local and overseas manufacture for you, but I couldn't find one in the available time. I suspect dealers in Thailand shy away from publishing prices that would allow comparison

SC

I find it difficult to believe that Toyota, Ford and Honda all sit down and decide to price cars they make and sell in Thailand at 100% more than the same car they sell in Malaysia or Indonesia.

I guess this applies only to autos? Because I know there is not much difference between motor scooter prices.

I think there is a difference in car prices but the difference goes to the government on imported cars or car parts and not to the producer. That all the manufacturers operating in Thailand would agree to raise domestic prices by the same percent is not believable or possible.

Buy, hey I could be wrong. All it takes is someone to find the price for an auto made in Thailand and somewhere else and compare the price.

Edited October 19, 2012 by chiangmaikelly

[StreetCowboy]

OK. I couldn't find data for Thailand to give you a good price comparison, so here is data from Malaysia, which offers similar tariffs to encourage local manufacture. Their local car industry is probably more competitive since they have several mass production local brands, although its a much smaller market. Labour costs are significantly higher here, as well, I think.

Anyway:

Hyundai Electra, locally manufactured: 85,000 ringgit (about 850K Baht) (about 27,800 US)

Slightly higher spec vehicle in the US: approx. US$ 17,800

The Proton Preve (slightly lower spec vehicle) sells for RM 58,000 (about 19,000)

It wasn't available in the US. The equivalent, say a Ford Fiesta, about 13,000 US.

Whether the manufacturers spend the difference on inefficient practices, or quick return on capital, it is the consumer that pays for the tariffs, whether he buys an import or a locally manufactured vehicle. And fair enough, because the manufacturers have to pay for their investment quickly, as the tariffs may be reduced in the future.

SC

[thaicbr]

UK price for Honda PCX 125 ₤2500. (123.000b)

Thai price for PCX150 84.000b

Sent from my GT-P1010 using Thaivisa Connect App

[chiangmaikelly]

OK. I couldn't find data for Thailand to give you a good price comparison, so here is data from Malaysia, which offers similar tariffs to encourage local manufacture. Their local car industry is probably more competitive since they have several mass production local brands, although its a much smaller market. Labour costs are significantly higher here, as well, I think.

Anyway:

Hyundai Electra, locally manufactured: 85,000 ringgit (about 850K Baht) (about 27,800 US)

Slightly higher spec vehicle in the US: approx. US$ 17,800

The Proton Preve (slightly lower spec vehicle) sells for RM 58,000 (about 19,000)

It wasn't available in the US. The equivalent, say a Ford Fiesta, about 13,000 US.

Whether the manufacturers spend the difference on inefficient practices, or quick return on capital, it is the consumer that pays for the tariffs, whether he buys an import or a locally manufactured vehicle. And fair enough, because the manufacturers have to pay for their investment quickly, as the tariffs may be reduced in the future.

SC

Ford Fiesta Thailand 549 to 584,000 baht. Malaysia 642,307 baht

I think I converted everything right. You can check it out they are both on line.

http://www.ford.co.th/en/cars/fiesta/specifications/price-list

http://www.ford.net.my/fiesta/

Edited October 19, 2012 by chiangmaikelly

[StreetCowboy]

OK. I couldn't find data for Thailand to give you a good price comparison, so here is data from Malaysia, which offers similar tariffs to encourage local manufacture. Their local car industry is probably more competitive since they have several mass production local brands, although its a much smaller market. Labour costs are significantly higher here, as well, I think.

Anyway:

Hyundai Electra, locally manufactured: 85,000 ringgit (about 850K Baht) (about 27,800 US)

Slightly higher spec vehicle in the US: approx. US$ 17,800

The Proton Preve (slightly lower spec vehicle) sells for RM 58,000 (about 19,000)

It wasn't available in the US. The equivalent, say a Ford Fiesta, about 13,000 US.

Whether the manufacturers spend the difference on inefficient practices, or quick return on capital, it is the consumer that pays for the tariffs, whether he buys an import or a locally manufactured vehicle. And fair enough, because the manufacturers have to pay for their investment quickly, as the tariffs may be reduced in the future.

SC

Ford Fiesta Thailand 549 to 584,000 baht. Malaysia 642,307 baht

I think I converted everything right. You can check it out they are both on line.

http://www.ford.co.t...ions/price-list

http://www.ford.net.my/fiesta/

So the Ford Fiesta sells for about US$ 21,000, converting in my head - due to the import tariffs, this is much higher than US price. But why does the Proton, which does not attract import tariffs, sell for so much? Because it can.

Similarly locally built cars in Thailand. I am sure you have the time to look up and compare the prices of imported cars versus comparable locally built cars in Thailand, and you will find the prices differences much less than the amount of the tariffs. Now I don't know whether the car companies use their inflated price to pay for inefficient production (you say not, and that Thai factories are as efficient as those anywhere else; I don't know) or they may pay off their investments very quickly because of the risk of tariffs being lifted, or they may use it to pay bribes to politicians and so forth to compensate for the difficulty of doing business in Thailand, or they may channel the profits back to the home country, possibly in the form of subsidised exports rather than cash remittances - that would satisfy a government keen to boost production and balance of payments, and would be less visible external scrutiny

SC

[chiangmaikelly]

I honestly don't understand you. If your argument was true the Ford Fiesta would sell for less in Malaysia than Thailand. It does not. It sells for more in Malaysia than in Thailand. When you compare things stick with the same model in the same currency.

Try comparing Honda PCX motor bikes.

Edited October 19, 2012 by chiangmaikelly

[chiangmaikelly]

OK. I couldn't find data for Thailand to give you a good price comparison, so here is data from Malaysia, which offers similar tariffs to encourage local manufacture. Their local car industry is probably more competitive since they have several mass production local brands, although its a much smaller market. Labour costs are significantly higher here, as well, I think.

Anyway:

Hyundai Electra, locally manufactured: 85,000 ringgit (about 850K Baht) (about 27,800 US)

Slightly higher spec vehicle in the US: approx. US$ 17,800

The Proton Preve (slightly lower spec vehicle) sells for RM 58,000 (about 19,000)

It wasn't available in the US. The equivalent, say a Ford Fiesta, about 13,000 US.

Whether the manufacturers spend the difference on inefficient practices, or quick return on capital, it is the consumer that pays for the tariffs, whether he buys an import or a locally manufactured vehicle. And fair enough, because the manufacturers have to pay for their investment quickly, as the tariffs may be reduced in the future.

SC

Ford Fiesta Thailand 549 to 584,000 baht. Malaysia 642,307 baht

I think I converted everything right. You can check it out they are both on line.

http://www.ford.co.t...ions/price-list

http://www.ford.net.my/fiesta/

So the Ford Fiesta sells for about US$ 21,000, converting in my head - due to the import tariffs, this is much higher than US price. But why does the Proton, which does not attract import tariffs, sell for so much? Because it can.

Similarly locally built cars in Thailand. I am sure you have the time to look up and compare the prices of imported cars versus comparable locally built cars in Thailand, and you will find the prices differences much less than the amount of the tariffs. Now I don't know whether the car companies use their inflated price to pay for inefficient production (you say not, and that Thai factories are as efficient as those anywhere else; I don't know) or they may pay off their investments very quickly because of the risk of tariffs being lifted, or they may use it to pay bribes to politicians and so forth to compensate for the difficulty of doing business in Thailand, or they may channel the profits back to the home country, possibly in the form of subsidised exports rather than cash remittances - that would satisfy a government keen to boost production and balance of payments, and would be less visible external scrutiny

SC

Do I have this right?

1. Car companies use their inflated prices to pay for inefficient production. Apparently this is no longer just Thailand but now this also occurs in Malaysia too.
   
2. Foreign car companies pay off their investments very quickly because they are afraid of tariffs being lifted.
   
3. They use the profits in Thailand to pay bribes to politicians and so forth to compensate for the difficulty of doing business in Thailand. That is of course against the law in almost every country in the world.
   
4. The profits are channeled back to the home country US, Japan,Germany (all in on the scam). in the form of subsidized exports rather than cash remittances - that would satisfy a government keen to boost production and balance of payments, and would be less visible external scrutiny. This too is of course against the laws of the US, Japan and Germany.
   

Edited October 19, 2012 by chiangmaikelly