Chinese truck maker wins KBank loan

Kasikornbank has awarded a Bt106.82 million loan to Dongfeng Automobile (Thailand) Ltd, the local arm of Dongfeng-branded Chinese automaker, in its bid to lead in financing overseas businesses in Thailand.

Dongfeng Automobile is investing in an assembly plant in Thailand, for exports to Laos, Cambodia, Burma and Malaysia. With the annual production capacity of 5,000 small-sized commercial trucks, the only plant in Southeast Asia will take advantage of zero tariffs under the Asean Economic Community framework.

According to Pitaya Tanadamrongsak, managing director of Dongfeng Automobile (Thailand), the investment decision followed the sale of over 2,000 Dongfeng vehicles in Thailand in 2011. This year, the company expects to boost sales to 3,000 vehicles.

Patchara Samalapa, executive vice president of the bank, said that this assistance follows KBank’s emphasis on Thai-Chinese investment.

At present, about 2,000 Chinese SMEs are operating in Thailand and some 800 of them are seeking loans from the bank for a combined amount of Bt2.2 billion, Patchara said. He claimed that the value represents the highest amount extended by a Thai bank.

To accommodate the investment, KBank has set up business matching activities.

Isara Wongrung, executive chairman of Kasikorn Leasing Co Ltd, added that in Thailand, Chinese automakers sold 3,209 vehicles last year. Though the volume went up 52 per cent from 2,111 in the previous year, it accounted for only 0.4 per cent of total 794,486 vehicles sold.

KLeasing plans financial supports to Dongfeng distributors. In the initial stage, it has extended Bt195 million to 40 distributors.