Greater investment in supporting industries will be a crucial factor in strengthening the car industry to compete with other countries ahead of Asean economic integration, says the Industrial Promotion Department.
Employees work on an assembly line at the BMW manufacturing plant in Rayong province. Car production is set to increase this year in line with a rise in domestic and foreign demand. Supporting industries are being told not to worry about rising investment by car companies in neighbouring countries, as this will create opportunities for exports, especially for parts makers. PIYACHART MAIKAEW
"Supporting industries such as industrial machinery and electronic parts are the backbone of Thailand's car industry," director-general Arthit Wuthikaro said yesterday. "Rising capacity in those industries would help Thailand to increase its competitiveness."
He said the Bureau of Supporting Industries Development (BSID) would play a major role. In the short term, it would help small and medium-sized enterprises (SMEs) to cut costs and improve productivity, while it would incorporate some technology to support the automobile industry in the long run.
In cooperation with the BSID, the Industrial Promotion Department will focus on developing SMEs' human resources, technology and automation.
The government will also provide help for SMEs to access financial support to help increase productivity and improve machinery.
The government will build testing laboratories to reduce costs during product testing.
The department will hold business-matching events to help SMEs to find qualified partners to develop production capacity.
"We plan to seek at least 500 Japanese companies that are the best in their fields to match Thai SMEs," Mr Arthit said.
He said car production was set to increase this year in line with a rise in domestic and foreign demand.
Supporting industries should not worry about rising investment by car companies in neighbouring countries, as this will create opportunities for exports, especially for parts makers, Mr Arthit said.
"Indonesia may take advantage of larger economies of scale since its market is bigger," he said.
"However, Thailand has a better reputation for quality, which has been developed over many years."
Major car makers from the US, Europe and Japan still see Thailand as a major country of interest for their expansion.