Trane presenters display the company’s latest units, which the firm hopes will drive sales this summer.

Trane Thailand announced plans yesterday to spend Bt500 million relocating and doubling the capacity of its local air-conditioner factory.

Surichai Patarakitnirun, managing director for Thailand and Indochina, said the US-based company would relocate its 15-year-old Samut Prakan plant on Puchaosamingprai Road to a new site on Bang Na-Trat Road.

Trane's existing factory sits on 12-rai plot and has limited expansion opportunities.

Its lease in Samut Prakan is also set to expire at the end of the year. The company, which employs 400 people at the plant, expects to hire 15 to 20 per cent more workers after it moves into the new factory around the beginning of next year.

"I'm seeking a long-term lease for an appropriate land plot of about 20 rai in the Bang Na-Trat area to build our new factory," said Surichai.

"We aim to double our production capacity for air-conditioner products from 100,000 units per year to more than 200,000 units after the relocation to the new factory," he said.

Surichai said that the expansion would help it meet the increasing demand for air-conditioners in the residential sector.

It will also help it export more units to Southeast Asia, the Middle East, Latin America and Europe.

"We plan to increase our exports by at least 10 per cent this year," said Surichai.

He said that Trane last year also moved its production for commercial air-conditioners weighing between 20 and 50 tonnes from Penang, Malaysia, to Thailand to take advantage of lower production costs and the growing domestic market.

Trane also has factories in Malaysia and Taiwan that produce commercial air-conditioners weighing between five and 50 tonnes, and in Thailand and China where it makes mini-split air-conditioners for residential customers.

Surichai expects that demand for home air-conditioners in Thailand will jump 20 per cent this year to 700,000 units, driven by climbing temperatures and air-conditioner prices that are dropping to more affordable levels.

"The price of air-conditioner products in Thailand has dropped by at least 10 per cent every year due to tougher competition from players from China and Korea.

The Japanese players have also adjusted their prices to protect their market share," said Surichai.

He added that the price reduction allowed larger consumers to afford the price and stimulate the market growth.

Trane yesterday also launched a new air-conditioner range that it plans to promote as "fighting models" against competitors.

The new units are priced 15 to 20 per cent lower than its other models with similar specs.

The new Triple E (economic, endurance, and energy saving) will be available with 9,000, 12,000 and 18,000BTUs, and priced at Bt16,000, Bt18,900 and Bt22,000, respectively. The products come with a seven-year warranty. Trane Thailand posted sales of Bt3.6 billion last year, up 14 per cent from 2004.

About 80 per cent was from domestic sales, 20 per cent from exports. The company expects sales of Bt4 billion this year and hopes to maintain the same export and domestic sales proportion. 

Kwanchai Rungfapaisarn

The Nation