Asean central to Japan's auto expansion
Southeast Asian countries are the key to Japanese carmakers' plans to secure a larger share of the global market using an integrated system encompassing development, production and distribution in the main markets in Asean.
Japanese manufacturers see the acceleration of Asean moves to conclude free-trade agreements with countries including Japan - a Japanese-Malaysian FTA came into effect on July 13 - as an opportunity to focus on the region in an effort to secure a larger global market share. For instance, on July 20, Nissan Motor announced plans to set up an export base for automobile parts near the Thai port of Laem Chabang. Components manufactured by 94 makers in Thailand will be shipped abroad, along with the Tiida compact car's body panels, with interior parts being exported to Mexico and engine parts to South Africa for local assembly. The Thai base is part of Nissan's global strategy to include Asean countries in its component supply network. The export base is scheduled to become fully operational by January 2007, handling an estimated US$300 million (Bt11.38 billion) worth of shipments per year, the second-largest amount for Nissan, after Japan. Nissan also plans to build a similar base in Indonesia in August 2007. Mitsubishi Motors, meanwhile, last year fully updated its Thai-centric pickup truck, and is now exporting the new model, the Triton, from Thailand. In early July, Toyota Motor established a production support company in Thailand manned by a Japanese task force with the goal of improving the speed and efficiency of individual production companies in Asia. As part of its global strategy, Toyota has been producing vehicles in Thailand and Indonesia for export to Europe, the Middle East and other regions - except Japan - since 2004. The growing tendency among Japanese auto-makers to launch new bases in the region is a reflection of the improvements in the quality of components manufactured by local suppliers. Another factor behind the new round of Asean investment by Japanese auto-makers is the Asean Free Trade Area plan, which is designed to facilitate the liberalisation of regional trade. Toyota, for instance, produces diesel engines and body panels in Thailand, petrol engines in Singapore, transmissions and velocimeters in the Philippines, and steering components in Malaysia. The supply of components and shipment procedures for the four countries are carried out through Toyota's Singapore base.
Daily Yomiuri Asia News Network TOKYO
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