Japanese car maker Honda Automobile (Thailand) is pressing ahead with construction of its second factory in Prachin Buri despite flooding in some areas of the province.
A Bangkok Metropolitan Administration official inspects the Ladkrabang Industrial Estate’s drainage system to ensure it works properly. The flood prevention and drainage systems of several industrial estates are being checked after the Amata Nakorn Industrial Estate in Chon Buri province became severely flooded this week. APICHART JINAKUL
Executive vice-president Pitak Pruittisarikorn said the construction site for the second plant is located on high terrain 25 metres above sea level in the Rojana Industrial Park in Si Maha Phot district.
In 2011, Honda's plant in Ayutthaya was flooded for two months, halting production for five months.
After the flood, Honda destroyed 1,055 affected cars to ensure consumers' confidence before restarting production on March 31, 2012.
The new factory, which is about half completed, is unlikely to face flooding, as the site is on high ground and waterways are being placed around the plant.
"Honda is confident Prachin Buri's industrial area will not be flooded, while the water level in some flooded areas is now subsiding," said Mr Pitak.
Honda is spending more than 20 billion baht to build the plant and expand its Ayutthaya facility to tap strong domestic demand and exports.
A total of 17.2 billion baht will be used to build the assembly and engine plant in Prachin Buri. It will have annual production capacity of 120,000 cars.
Construction started in July, with operations due to launch in April 2015.
The Thai unit of Japan's third-largest car maker is also spending 2.03 billion baht to increase its Ayutthaya plant's annual production capacity to 300,000 vehicles by early next year.
The expansion, combined with the capacity of the new plant, will increase Honda's annual production capacity in Thailand to 420,000 vehicles in 2015.
Mr Pitak said the factory zone in Ayutthaya's Rojana Industrial Park has no flooding, and logistic routes remain available.
Honda now operates two production shifts in Ayutthaya, and all completely assembled units can be stocked at the plant with no need to move them, he said.
However, the company is closely monitoring the flood situation in both Ayutthaya and Prachin Buri.
Honda has set a sales target for Thailand this year of 200,000 vehicles, up by 16.8% from 171,208 last year.