German car parts maker and industrial services company Robert Bosch GmbH is investing about €43 million (1.7 billion baht) in a new factory and automotive research and development centre in Thailand to accommodate its growing business in the region.
The investment is a part of €80 million the company plans to pour into the Asean region this year.
The remaining budget is slated for an expansion of its manufacturing and sales facilities in Indonesia, Malaysia and the Philippines, most of which are scheduled to begin operations next year.
The new factory and automotive research and development centre at Hemaraj Eastern Seaboard Industrial Estate in Rayong is scheduled to complete construction this year, and start operations mid-2017.
The new plant will produce fuel injectors with an annual capacity of 1 million units and is expected to create about 800 jobs.
According to Peter Tyroller, president for Asia-Pacific, Asean is an important region for Bosch, after China and India, with a market population of 600 million people whose incomes are increasing annually.
He said although Asean features both developed and developing countries, it is still an emerging market for Bosch to beef up its business in a long run.
Bosch predicts Asean's automotive industry will become the world's fifth largest car production base by 2023, driven mainly by Thailand and Indonesia.
Last year, the region produced 3.9 million vehicles, down 2% from the previous year. The region was ranked seventh among car production bases in the world.
"Bosch expects high growth in Asean, 5-6% per annum in the automotive sector," he said.
Bosch's sales revenue in Asean rose to €800 million last year. It invested €210 million during 2013-15 in Asean, aiming to generate €2 billion in revenue by 2020.
In Asean, Bosch now has nine sales offices, seven manufacturing plants and one representative office.
In Thailand, it reported revenues rose 22% to 10.8 billion baht, marking both a 25-year high and the strongest sales among its Asean operations.
Joseph Hong, managing director of Robert Bosch Thailand, expects revenue to see double-digit growth this year.
The group manufactures automotive components at its facility in Amata City Industrial Estate in Rayong, and produces packaging machinery and hydraulic equipment at its plant in Amata Nakorn Industrial Estate in Chon Buri.