Arcelik A.S., the parent company of Beko, a Turkish domestic appliance and consumer electronics brand, is planning to further expand its business in Thailand as part of its strategy to boost revenue in Asean to reach US$500 million over the next five years.
During his visit to Bangkok last week, chief executive Hakan Bulgurlu said three years after entering the Thai market, the company is happy with the performance of Beko appliances in the country.
He said that Thailand is still a small market for now but the company is looking at Thailand, Myanmar and Laos as countries where the Beko markets could grow to rival, if not surpass, those in Malaysia and Vietnam.
Mr Bulgurlu added that Thailand is important as it houses the regional headquarters for Beko.
The company has invested about $100 million to set up a refrigerator production plant on the Hemaraj Industrial Estate in Rayong province, which started operations in the first half of last year.
The company plans to invest more in Thailand to expand both its refrigerator and other Beko product lines over the next 3-5 years.
The Beko refrigerator factory in Rayong last year produced 80,000 units. It plans to increase that figure to 300,000 this year, with the additional output intended for the Asean market.
The production capacity of Beko refrigerator products at the Rayong plant is projected to reach 1 million units over the next 2-3 years, he said.
An estimated 70-80% of those units will be exported to countries in Southeast Asia, China, Australia and Europe.
"Once we maximise our production capacity, we will be able to make refrigerators with innovative designs and features at more reasonable prices that fit Asean consumer demand," he said.
"Though we are a young brand, we are ready to attack the market and are confident we will be successful in Asean the same way we have been successful in Europe," said Mr Bulgurlu.
Thailand's home appliance market was worth 50-60 billion baht last year, with key market players including Japanese and South Korean brands.
Beko is the second largest brand in Europe in the white goods sector and has been the fastest growing brand in the overall European market for the last seven years, according to the company.
"It's quite unusual for us to use Thailand as a regional hub for our business. Most companies prefer Singapore, Hong Kong or China. But we chose Thailand, not only as the regional hub for Southeast Asia, but for Australia, China and New Zealand, because of its well-developed economy and sophisticated consumers, good infrastructure development, skilled labour and the government's 4.0 strategy," he said.
Apart from its own factory, the company has also set up a research and development centre in Rayong.
It also established its own distribution team last year, replacing local players.
Mr Bulgurlu said that Southeast Asia provides strong growth opportunities for Beko.
"Thailand, Vietnam, Indonesia and the Philippines are among our priority markets to expand in the future," he said.
Mr Bulgurlu added that the company expects to have double digit market share in Asean within the next five years, reaching revenue of $500 million.
Global sales of Beko reached $5.2 billion baht last year, $250 million of which were generated in the Asian market.