October 22, 2011 00:00 By Nalin Viboonchart The Nation 2,233 Viewed
Auto production this month and next is expected to fall by about 150,000 units if major carmakers cannot resume operations soon, said Federation of Thai Industries (FTI) chairman Payungsak Chartsuthipol.
Though many car-assembly plants are not flooded, their parts suppliers are, so they have had to suspend production. However, they are seeking ways to source the parts from overseas suppliers so as to resume operations, said Suparat Sirisuwannangura, president of the FTI’s Automotive Industry Club.
He said the estimated production loss of 150,000 units was the worst-case scenario. The industry recorded total auto output of 1.28 million units from January to September. If the club’s most pessimistic forecast materialises, total auto production this year will be about 1.65 million units, a slight increase from last year’s 1.64 million.
The club’s spokesman Surapong Paisitpattanapong said all auto-makers except Honda had submitted production forecasts for the final three months of this year. Output will drop by 20,000 units per month from the loss of Honda production. So the automotive industry expects combined auto output of 456,000 units in the current final quarter, while the number during the first nine months of the year was 1.28 million units.
Based on the recent forecasts, auto production this year is predicted at 1.7 million units, a drop from the previous target of more than 1.8 million, which was set before the floods hit the industrial zone in the Central provinces. Since then, major carmakers Toyota, Mitsubishi, Nissan, Ford, Mazda and Isuzu have temporarily halted production because of parts shortages.
The severe impact to the automotive industry from the floods occurred just one month after the industry saw record-high production and exports. Surapong said production in September was 174,212 units, up 23.19 per cent year on year. Production from January to September was about 1.28 million units, up 7.35 per cent year on year.
Exports in September alone were 90,654 units, up 11.48 per cent, worth B57.138 billion. Exports from January to September were 640,000 units, down 3.79 per cent.
In another flood-related matter, the Thai Industries Sentiment Index in September plunged to 90.7 and is getting worse in October because of the floods, according to the FTI. A level below 100 reflects low confidence.
Payungsak said the index was at its lowest point in 26 months. The major concerns of the industrial sector are the floods that cover the country’s important industrial sites, the transport disruption caused by the floods as well, and the volatile global economy.
Meanwhile, flooding is continuing to affect some of Toyota’s automotive-component suppliers. Toyota Motor Thailand announced yesterday that it would further suspend the operations at all three of its plants as floods still ravage some suppliers.
The plants in Samut Prakan and Chachoengsao will remain closed until next Friday, the company said in a statement. They have been suspended since October 12.
The supply-chain disruption is expected to reduce output at several automotive companies, chiefly Toyota, Honda, Nissan and Mazda.
Toyota, the country’s biggest auto-maker, has annual capacity of 650,000 units. In August, it churned out 61,000 units.
To help relieve flood-affected victims, Toyota will hold a “Toyota CSR for Flood Relief” project today and tomorrow. Carried out by Toyota CSR network members and Toyota staff, the project will construct mobile emergency toilets for donation to the Royal Thai Navy Disaster Relief Centre.