Mitsubishi spending Bt1 billion on increasing Thailand output

Corporate March 21, 2013 00:00

By YUTTAPONG PASEE
THE NATION

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Mitsubishi Motors has announced a Bt1-billion investment aimed at raising its annual Thai auto production capacity to 510,000 units per annum by the end of this year.



The expansion is in line with the carmaker’s goal of having exported an aggregate 3 million vehicles from Thailand within the next three to four years.

The company is also in the process of transferring some of its research and development (R&D) units from its Japanese headquarters to Thailand to serve the Asean Economic Community (AEC), which comes into effect in 2015. Osamu Masuko, president and CEO of Mitsubishi Motors Corp, said during his visit to Thailand this week that to celebrate the 2 millionth vehicle produced by the company in the Kingdom, it was investing Bt1 billion in increasing local production capacity to 510,000 units by the end of the year.

The current annual capacity is 460,000 vehicles. Thailand has been promoted by the parent company as one of Mitsubishi’s significant global markets as part of its international strategy, and the target is to achieve 3 million units in accumulated Thai exports within the next three to four years. He said the company’s decision to transfer some of its R&D units to Thailand had been taken because it wanted to increase the number of local and Japanese engineers in Thailand’s R&D department from the current 40 to about 120 within the next two years.

The group will also increase its investment in R&D equipment and testing tracks in the Kingdom. Masuko listed three missions for the local R&D unit: a commitment to develop the quality of any Mitsubishi vehicle produced in Thailand to quickly serve the demand and requirements of Thai consumers; increasing the role of the R&D unit so that it has the ability to develop minor-change models by itself; and conducting its own survey about market and technology trends within Asean to serve the upcoming AEC. Mitsubishi first invested in auto production in Thailand in 1988, and became the first auto-maker to export Thai-made vehicles worldwide.

Another milestone was reached last month, when the company shipped its 2 millionth Thai-made export.

These landmarks reflect the global standard and high-quality vehicle production which made Mitsubishi decide to strengthen its R&D function in Thailand, said the company chief. Mitsubishi Motors Thailand’s 2-million export achievement is a mix of completely built-up (CBU) and completely knocked-down (CKD) vehicles.

The approximately 1.7 million CBUs exported were made up of 1,436,146 one-tonne pickups (Strada, L200 and Triton models), 181,464 Pajero Sport passenger pick-up vehicles, and 95,726 passenger cars (Lancer and Mirage models). About 300,000 CKD sets were exported.

The CBUs were mainly shipped to other Asean countries, the Middle East, Europe, Africa and Australia.

The CKDs, largely pickups, were mainly exported to Latin America.

Throughout the 25 years that Mitsubishi Motors Thailand has exported vehicles to more than 140 countries, local production standards and Thai technicians’ skills have been accepted and trusted, Masuko added.

The company has three production plants and an engine plant at Leam Chabang Industrial Estate in Chon Buri, which is Mitsubishi’s first priority business unit outside Japan. It is second only to the Mizushima plant in Japan in terms of capacity, but is the group’s top performer in terms of production utilisation.

Last year, Mitsubishi invested Bt16 billion to establish its third production plant in Thailand, the focus of the new facility being to produce small cars under its “Global Small” project, which is also in line with the Thai government’s “Eco Car” project. The local company commenced production of the Mitsubishi Mirage at the plant with an initial capacity of 150,000 units annually. The plan is to expand the capacity to 200,000 cars by the end of this year and make Thailand the group’s production hub for small cars.

The policy to strengthen R&D in Thailand shows the high level of confidence Mitsubishi has in the local unit and the Thai engineering team, Masuko said. The Thai R&D branch is the group’s first R&D operation in Asia, outside Japan.