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Confident of Growth in Thailand, Ford Launches Key Plant Project
Automotive giant Ford Motor Company, already a major investor in Thailand, now sees the country as an even more crucial part of its future success. In June, Ford announced a 15 billion baht (US$450 million) investment to build a 750,000sqm state-of- the-art passenger car plant in Rayong province. The factory is scheduled to start production in 2012, with an initial capacity of 150,000 units.
The plant represents another big stride under the company’s aggressive expansion in the Asia-Pacific region, which is projected to account for 40% of global auto industry growth in the decade ahead. Besides building the next-generation Ford Focus for Thailand and neighboring markets, the highly fexible factory will be capable of manufacturing a range of other vehicles in the future.
“The Asia-Pacifc region is arguably the world’s most dynamic. There is no doubt it will continue to be a driver of the future growth of the company,” said Alan Mulally, CEO of Michigan- based Ford Motor Company. He made the remarks via video at a 24 June press conference in Bangkok’s Plaza Athenee Hotel to launch the large-scale project in Thailand.
Joseph R. Hinrichs, group vice president and president, Asia and Africa, added to that: “The auto industry is growing rapidly in Asia, everywhere from China to India to Thailand and markets all around ASEAN. Even during the global economic downturn, the Asia-Pacifc auto market grew, and currently we are seeing a 15% increase from last year. That is one of the major reasons we need this new facility in Thailand for additional capacity.”
This latest investment by Ford also represents a signifcant contribution to the Thai economy. There is the potential to create 11,000 jobs: employment of 2,200 workers directly with Ford in Thai land and an additional 8,800 through local suppliers and dealers. An estimated 26 billion baht worth of components will be purchased along Thailand’s supply network.
Ford bought 187 acres for the project at Hemaraj Eastern Seaboard Industrial Estate in Rayong, eastern Thailand. “We are thrilled to continue our automotive cluster industrial development with Ford Motor Company for their new plant in Thailand,” said David Nardone, president and CEO of Hemaraj Land And Development Public Company Limited.
In fact, Hemaraj Eastern Seaboard Industrial Estate, which now comprises 6,713 acres and 140 auto companies in over 220 auto factories, started with Ford in 1995 through AutoAlliance Thailand (AAT). The estate bears the nickname Detroit of the East because of its substantial concentration of automotive production.
While the new plant will be 100% Ford-owned, it adds to the company’s other manufacturing facility in Thailand, the AAT joint venture between Ford and Mazda Motor Corporation. With a start-up of 17 billion baht, AAT was expanded to investment totaling more than 51 billion baht. Located in the same industrial estate, the JV has approximately 5,600 workers and currently is running at capacity. Among the models manufactured at AAT are the Ford Ranger pickup, Mazda BT-50 pickup, Ford Everest SUV, and smaller cars. In July 2007, the plant celebrated accumulative production of 1 million units.
Aside from the two Rayong manufacturing facilities, Ford has sales offces and its ASEAN headquarters in Bangkok. “Outside of China, Thailand will now have Ford’s largest capacity in Asia,” Hinrichs said.
The Latest Technologies
At the nascent facility, the next-generation Ford Focus will be built on the company’s global C-car platform, which will eventually underpin up to 2 million Ford vehicles sold in markets around the world. C-car, currently the world’s largest vehicle segment, is projected to account for nearly 28% of global passenger car sales by 2013.
Ford press releases trumpet the Focus as having the latest smart technologies, great styling, creature comforts, and world-class leadership in quality, safety and fuel effciency.
“It is the embodiment of what Ford is doing to bring the company together around the world on the same platform. The Focus is a foundational part of the turnaround of Ford Motor Company,” Hinrichs remarked.
The design of the new plant features numerous sustainability initiatives. Ford will incorporate its Three-Wet-On painting technology that reduces volatile organic compounds, CO2 emissions and waste, and improves paint quality, depth and durability. “The Three-Wet-On process can apply layers of paint multiple times and run through the oven only once. This is much more energy-effcient and environment-friendly compared with other processes where paint goes through several ovens to dry,” explained Raj Nair, vice president of Ford Asia Pacifc and Africa.
The body shop and fnal-assembly buildings at the plant will have natural ventilation. Energy-effcient indoor and outdoor lighting is another feature. Daylight through skylights reduces electricity consumption. The plant will also host a pilot project incorporating photovoltaic power storage and next-generation LED lighting. There will be recycled content of building components, and the facility has an on-site wastewater treatment plant.
Yet another special technology is the ergonomic trim shop’s use of so-called flexible skillets. These moving platforms are programmed to consider the height of the individual operator doing the various tasks as the car travels down the assembly line. The operator’s computerized platform actually moves along with the car, rising and descending so that he or she does not need to reach up or down strenuously, promoting comfort.
A lot is going on in the auto industry, and Ford is playing a leading role in fresh solutions with its cutting-edge technologies. One trend is for power trains that feature greater fuel effciency. At the forefront stand Ford’s EcoBoost engines, which are downsized but then turbocharged to provide the same power as before with better emissions and fuel economy.
Small cars are also enjoying stronger demand as they emerge with much more capability than 10 to 15 years ago. All kinds of electric vehicle and hybrid technologies are developing as well. “Ford is a leader as these evolve,” Hinrichs said.
The company also sees social care as one of its responsibilities. “Ford employees have a very good track record in making themselves available,” said Peter Fleet, president of Ford ASEAN who is based in Bangkok.
In fact, giving back to society is regarded as one of Ford Motor Company’s strengths. “We take it very seriously, wherever we are in the world, to be actively involved in community services and fund-raising,” Hinrichs said.
Among the many such activities by Ford is the Driving Skills for Life program. So far thousands of free tutorials on good driving skills have been provided to young people across ASEAN to promote road safety.
As with the AAT joint venture, Ford’s major new project is promoted by the Thailand Board of Investment (BOI). “We would not be making this announcement without the support of the BOI. Millions of dollars in investment, 750,000 square meters and up to 11,000 jobs created. All of these are monumental events, and it requires a partnership between the company and the government to make such things happen,” Hinrichs said.
He added: “We are optimistic about Thailand. Through the different political cycles, there has always been continuity in support of the auto industry here. That is part of why we are confdent in making this investment in the country’s future.”