||Success Story Detail
Thai Summit Confident of Greater Growth in Thailand Auto Industry
A 100% Thai-owned enterprise, the Thai Summit Group this year is celebrating its 35th anniversary, being established on 16 March 1977. Today, with US$2 billion in annual sales, the group has expanded to over 30 affiliated companies. Of these, 15 are subsidiaries wholly owned by Thai Summit, nine are joint ventures and 11 are overseas companies.
Thai Summit is a leading manufacturer of parts for the automotive, motorcycle, electrical appliance, and agricultural engine industries. Automotive accounts for 72% of total output and motorcycle parts 26%. The group operates manufacturing facilities in Thailand’s Samut Prakarn, Laem Chabang, Rayong, Ayutthaya and Nakornnayok provinces, and overseas in Malaysia, India, Vietnam, Indonesia and China. Automotive parts are manufactured in most of the locations, with motorcycle parts production concentrated in Thailand’s Samut Prakarn, India, Vietnam and Indonesia.
The company supplies most of the world’s famous automotive makers, from Thailand and Japan to Europe and America. Its customers include, among others, AutoAlliance Thailand, Volvo, Mercedes-Benz, Isuzu, Ford, Mitsubishi, Nissan, Proton, Toyota, Peugeot, Suzuki, Kawasaki, Honda, Triumph, GM, Chrysler and Freightliner.
As major makers have production bases here and government policy provides strong support, the company sees Thailand’s automotive industry making a quick recovery from last year’s flooding, which had temporarily interrupted supply lines. It anticipates car production in Thailand hitting 2.05 million units for 2012 and 2.5 million in 2015.
The group’s flagship company, Thai Summit Auto Parts Industry Co., Ltd., is one of Thailand’s biggest producers in the line. With nearly 15,000 employees at its several factories in the country, the local operations concentrate on body parts and chassis frames, all for the domestic market.
The company touts Thailand’s many advantages as an excellent operating base. There is much strength in the long experience of the many automotive suppliers in the country. Thai workers are willing to learn and have good skills. Moreover, Thailand’s location at the heart of Asia is a big plus, especially for efficient logistics. Thai Summit also praises the incentives granted by the Board of Investment as very helpful to automotive investors.
Competitive Advantages for Growth
Thai Summit explained that five factors give it a competitive edge: being located near customers, providing customers with one-stop service, adopting from the best practices of various customers, substantial purchasing power from combining volume, and utilizing low-cost production sites.
The company has also forged technical assistance agreements with its joint-venture foreign partners, enabling it to acquire advanced technology and achieve higher levels of operation. With such cooperation, Thai Summit raises its production capability continuously, resulting in increasingly better products for customers.
And the company continues to grow, with recent investments showing its confidence in Thailand as an outstanding investment location. Under its latest strategy, Thai Summit has announced an aggressive plan to invest 5 billion baht into factory expansion in Thailand during 2012. The project aims to boost manufacturing capacity to meet rising demand from the company’s customers with the local industry recovering robustly from last year’s flood. The company also intends to pour about 4 billion baht into new projects overseas in 2012 to accommodate growing vehicle production across Southeast Asia and in China.
Thai Summit projects that its revenue will soar by at least 20% this year. Automotive makers in Thailand are scheduled to launch 10 new models of pickup trucks, passenger cars and eco-cars and Thai Summit is the parts supplier for most of these.
Giving back to society for its solid success, the company consistently engages in social and environmental care projects, with its Thai Summit Pattana Foundation playing a major role in such activities. Most recently, the company helped victims of last year’s flooding by providing food, rafts, toilets and water tanks.
The 10 member countries of the Association of Southeast Asian Nations will form the ASEAN Economic Community in 2015, creating a 600-consumer single market. Thai Summit sees the resulting free flow of goods, services, capital and people across the regional bloc as presenting both opportunities and challenges for Thailand’s automotive industry. The company explained that while the elimination of barriers will make trade easier and overseas investment more feasible, this will also intensify competition.
To prepare for the AEC, Thai Summit is emphasizing the importance of workforce skill. “Personnel development is one of the focuses of our policy,” the company said.