Local land transport operators are worried about a possible influx of US and European companies to Thailand through Asean nominees as Western markets decline.
The Land Transport Federation of Thailand (LTFT) yesterday said local businesses will be at a disadvantage once full liberalisation of the sector occurs under the Asean Economic Community (AEC) in 2015.
The AEC will enable Asean investors to own up to 70% of a business outside of their home country.
Next year, foreigners will be allowed to raise their ownership to 51% from 49%.
With 200,000 companies and more than 800,000 trucks in operation, Thailand's industry is valued at 600 billion baht.
LTFT chairman Yoo Chienyuenyongpong said local operators are worried they cannot compete with the huge amounts of capital from large US and European logistics firms that could come through their Asean nominees.
"With Western markets in decline, large companies from the US and Europe are eyeing Asia for their business expansion, and Thailand has a geographical advantage for becoming the region's land transport hub," he said.
European and US capital will come through Singaporean nominee companies, while Chinese firms will enter through Vietnamese and Lao operators.
Thai companies command 90% of local truck transport, but with the AEC allowing Asean investors a higher ownership share, this looks set to change.
Big foreign players have already acquired some Thai operators but have not yet started service, said Mr Yoo.
Large global logistics firms have had a presence in Thailand for a while now, but have not penetrated the land and truck segment.
Mr Yoo urged the government to conduct thorough background checks to determine whether any Asean firms looking to invest in Thailand are really nominees of foreign players.
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- Writer: Soonya Vanichkorn