Small and mid-size automobile businesses in Thailand are locked in an escalating battle for workers with big carmakers.
“Toyota is an important customer, but it's poaching workers from us with generous bonuses,” said the manager of a small Japanese autoparts supplier in Thailand, after a college graduate the company had trained left the job after only a year to join a local Toyota affiliate.
Toyota Motor Thailand stunned the industry this year by offering annual bonuses of roughly 10 months' pay to its labour union.
The union's position was fortified by the booming home market. The Thai government's two-year tax relief programme for first-time car buyers drove new-vehicle sales in the country to an all-time high in 2012. This kept Japanese automakers, which account for more than 90 per cent of the market, running their local factories at full capacity towards the first half of the year.
Following in Toyota's footsteps, other carmakers and auto-part suppliers offered similar bonuses. This encouraged workers at smaller Japanese auto-part makers to jump ship to Toyota and other firms.