With major clients like BMW, Daimler Chrysler and Volvo, ZF has an 85-per-cent share of the market.

The company also provides parts for Isuzu, Hino and MAN in Thailand. Since its merger in 2005 with Sachs, it has been known as ZF Sachs.

Although ZF and Sachs are scarcely household names to car-buyers, in the world of motor sport they mean performance. ZF is a high-end transmission-producer that supplies Porsche and BMW, while Sachs is one of the most popular shock-absorber makers in motor racing, including Formula 1.

"We have a strong presence in Thailand, and now we are looking at prospective clients in the neighbouring countries. Currently there are no offices in these countries, and we are still exploring possibilities. We are confident, however, that we will soon have customers in Vietnam and Cambodia," said Sumate Jaito, managing director of ZF Thailand. ZF has its regional HQ in Singapore and a production facility in Malaysia.

ZF established its office in Thailand over seven years ago and is owned completely by ZF Germany. The company has an assembly plant in Rayong that puts together CKD (completely knocked-down) parts. ZF divides its services into three categories, first the original-equipment manufacturer (OEM) market for which the company provides low-quantity but high-value products such as axles and transmissions, second the OEM market for spare parts, and third workshops, known as Original Sachs Service (OSS).

As the company is fully supported by its German parent, it has many advantages over competitors in the region. In Thailand ZF develops bus concepts with Cherchai Bus Body. Besides involvement in the passenger-car and bus and truck industry it also provides parts for off-road vehicles for the agricultural sector, excavators, bulldozers and mixer drives for cement trucks.

Most of the parts provided are transmissions and suspensions. Sumate added that ZF had over 50 per cent of the off-road market.

"Our plan for Thailand this year is to expand the number of OSS centres to 30 from the current 20 that we have. In the future we plan to have over 100 centres around Thailand. The OSS centres do not require high investment but a standard of operation up to the levels set by Sachs. The difficult part about expanding our centres is to provide the right training for our staff there. We will also help host the Porsche Carrera cup and Formula BMW race at the Bira International Racing Circuit," he said.

The Bira events are seen as promoting the high-performance image of ZF and Sachs. At the OSS centres customers can buy high-end parts.

Sumate added that the current political problems and oil-price hike had also effected the spare-parts industry, as more customers were holding off on buy ing a vehicle. Also the moratorium on major government projects has slowed production of commercial vehicles. He added that the climate of uncertainty was causing a slump in the sector.

Vijo Varghese

The Nation