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14 May 2014

Industry

Auto Tires: Investment Promotions Needed to Profit from Thriving Global Car Industry (Current Issue No. 2502 Full Ed.)

Auto tires are one of Thailand's promising products that we should keep an eye on, thanks to our advantage as a large producer of quality natural rubber sheets and blocks that are ideal for the production of all categories of auto tires. Moreover, Thailand is one of the world's important production bases for automobiles and auto tires, with output geared toward meeting global demand, e.g., countries such as the US, which boasts the world's second highest auto sales. Gradual improvements seen in the US economy and purchasing power, which should help reinvigorate its automotive industry and, in turn, the auto tire industry, will likely benefit our auto tire exports to the US ahead.
Over the long-term, Thailand should place more importance on promoting foreign investments, as well as the development of our skilled labor to attract more international companies to use Thailand as their production bases for automobiles, auto-parts and auto tires. Meanwhile, business opportunities for Thai auto tire companies will likely focus on auto tires for commercial vehicles, e.g., trucks and agricultural vehicles, plus spare tires, rather than on passenger car tires because buyers for the former vehicles place as much weight on pricing as on quality. On the other hand, manufacturers and exporters of auto tires for passenger cars will have to align their technologies and designs to those set by leading carmakers abroad, as well as on the standards of importers that place priorities on quality, safety and branding.

Because the Thai auto tire industry can generate export income of THB100 billion or more each year and has ample room for growth, it is necessary that we should maintain our status as the largest auto tire exporter in ASEAN by accelerating plans to attract further foreign direct investment (FDI), as well as on dismantling obstacles and ameliorating concerns that may inhibit the confidence of foreign investors thinking to invest in our auto tire industry. Moreover, it is necessary that we maintain long-term competitiveness within our auto tire industry versus Indonesia and Vietnam that are set to become major rivals in the near future.

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