Status of the Thai Auto Industry after the 2011 Flooding. Presentation for AFG Automotive Focus Group Thailand by Khun Charn Saralertsophon, Executive VP from Federation of Thai Industries (FTI).

1. A Resilient Thai
Automotive Industry
The Federation of Thai Industries
By
Mr.Charn Saralertsophon
Director General
27th January 2012

2. Global Positioning

3. World ranking of Automotive Production (Jul’11)
<x1,000 units>
Units
10,000
9,000
8,000
7,000
6,000
5,000 Thailand production ranking no.13 globally
4,000 957,846 units in 2011
3,000
2,000
1,000
0
23%
rs
a
ala a
Th ssia
Br a
h
ge ia
Ru a
Ja .
Ca ce
Tu K.
Ko y
U. a
rm n
Cz y
d
Sp il
M ain
do ly
Fr co
Ot ia
S.A
as
re
M t in
ec
an
e
Ge pa
d
di
in
an
Ar nes
he
In It a
ys
U.
an
rk
na
i
ex
In
Ch
n
ail
Source : Fourin
3

4. World ranking of Automotive Sales (Aug’11)
Units
<x1,000 units>
12,000
11,000
10,000
9,000
8,000
7,000
6,000 Thailand sales ranking no.15 globally
583,957 units in 2011
5,000
4,000
3,000
2,000
1,000
0
rs
Au rea
Be ina
Fr ia
Ru a
M sia
Ko a
Ja .
3% 23%
ce
K.
y
a
U. a
n
do d
Ot d
rm il
Th ain
Ca ly
ge o
t h um
S.A
Ge as
an
pa
20%
d
di
in
ali
In ilan
lan
Ar exic
ss
he
It a
U.
an
na
ne
In
Sp
nt
Ch
Br
Ne lgi
st r
er
a
Source : Fourin
4

5. ASEAN Markets

6. ASEAN Automotive Industry
ASEAN Automobile Market Share (Jan – Oct’11)
Vietnam, Brunei,
89,858 11,970
Indonesia ,
Thailand , 4% 746,199
713,842 32% 34%
2%
5% 23%
Singapore,
33,648 Philippines, Malaysia,
119,152 503,898
Total sales of 2,218,567 units
Source : ASEAN Automotive Federation
6

7. Thai Latitude

8. Thai Automotive Industry Situation
Thai Flood 2011
<x 1,000
units>
2,000 Japan Tsunami &
2010 2011 (adj. Forecasted)
Earthquake ?
1,800
• Production 1,645,304 1,400,000
1,600 • Sales: 800,357 700,000 Hamburger
crisis
• Export: 895,855 700,000
1,400 1 Mil milestone
1,200
1,000
800
Tom-Yung Kung
crisis
600
400
200
0
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011F 2012E
Production Domestic Export
8

9. Thai Automotive Industry Situation
Car Production (Jan – Oct’11)
Jan – Nov 2011 = 1,358,369 units Target 1.8 mil.
Jan – Nov 2010 = 1,507,901 units
% Growth = -1% Target 1.4 mil.
500%
240
Japan Tsunami Thai Flood 400%
200
172 174
160 146 300%
120 200%
80 100%
89 49
40 23%
24 0%
-68%
-25% -85%
0 -100%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Production 2010 Production 2011 % '11 vs '10
9

10. Car Production of Dec 2011
Units
180,000 172,004 174,212
157,982
153,646 152,689
147,236 153,180
160,000
150,743 151,143
146,231 141,416
140,000 132,165 148,878
127,849 145,771
141,049
137,403
120,000 105,110
103,849
98,804 99,426
100,000
89,179
80,000
60,000
49,439
Jan-Dec 2011 = 1,457,795 units
40,000 Jan-Dec 2010 = 1,645,304 units
320 % (Compared Nov’11) % Growth = - 11 % 23,695
- 28 % (Compared Dec’10) Plan 2011 = 1,794,486 units
20,000 - 31 % (Compared Plan) Actual < Plan = 19%
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Production 2011 Plan 2011 Production 2010
Source: Automotive Industry Club, FTI

11. Domestic and Export Production of Dec 2011
Jan-Dec 2011 Total = 1,457,795 units Jan-Dec 2010 Total = 1,645,304 units
- Domestic = 723,845 units ( 50%) - 4 % - Domestic = 750,614 units ( 46%)
- Export = 733,950 units ( 50%) - 18 % - Export = 894,690 units ( 54%)
Source: Automotive Industry Club, FTI

12. Thai Automotive Industry Situation
Car Export Sales (Jan – Nov’11)
Central &
PPV South
8% America
Europe 11% Asia
Passenger 32%
10%
car
25%
Africa
5%
Pickup
67% Middle East
21% Oceania
21%
Export Sales
Jan-Nov’ 11= 700,581 units Jan – Nov 2011 = 700,581
units
CBU Value : ~326,335 Mil. Bht
Jan – Nov 2010 = 824,830
Total Export Value : ~494,300 Mil. Bht units
Source： The Thai Automotive Industry Association % Growth = -15% 12

13. Car Domestic Sales of Dec 2011
Units
100,000
93,008 93,122
90,000 87,012
72,012 78,874
79,043
80,000 77,213
70,259 72,902
70,557
70,000
68,398 67,283 65,672
68,261
65,724
63,067 62,205
60,000 57,128 55,851
54,175 55,339
49,560
50,000
42,873
40,000
Car Domestic Sales
30,000 112 % (Compared Nov’11)
26,069
- 21 % (Compared with plan)
- 41 % (Compared Dec’10)
20,000
Jan-Dec 2011 = 795,250 units
- 1 % (Growth of Jan-Dec)
10,000
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Year 2011 Plan 2011 Year 2010
Month
Source: Automotive Industry Club, FTI

14. Car Domestic Sales of Jan-Dec 2011
P-Car: Jan-Dec’11 = 335,202 units
Jan-Dec’10 = 343,821 units
% Growth = -3%
Eco-Car: Jan-Dec’11 = 41,184 units
Jan-Dec’10 = 18,740 units
% Growth = 120 %
P/U 1t: Jan-Dec’11 = 327,675 units
Jan-Dec’10 = 347,314 units
% Growth = -6%
PPV: Jan-Dec’11 = 38,173 units
Jan-Dec’10 = 40,479 units
% Growth = - 6 %
Other: Jan-Dec’11 = 52,611 units
Jan-Dec’10 = 50,003 units
% Growth = 5 %
Jan - Dec’11 = 795,250 units
Source: Automotive Industry Club, FTI

15. Thai Automotive Industry Situation
Contribution to Thai Economics
To Manufacturing GDP Strong Suppliers Network
Automotive
Industry Assembler
10% (Car 16 Companies,
Foreign Motorcycle 7 Companies)
Joint
Venture
Foreign Thai Pure Tier 1
Manufacturing Majority Majority Thai (Total 690
GDP 54% 23% 23% Companies)
Tier 2,3
Local Supplier (1,700
Companies)
Thai Automotive Industry has huge contribution to Thai economy, supported by a
strong supplier network.
Source : Economist Intelligence Unit, UK
TAI 2010 15

16. Car Production of Dec 2011
Units
180,000 172,004 174,212
157,982
153,646 152,689
147,236 153,180
160,000
150,743 151,143
146,231 141,416
140,000 132,165 148,878
127,849 145,771
141,049
137,403
120,000 105,110
103,849
98,804 99,426
100,000
89,179
80,000
60,000
49,439
Jan-Dec 2011 = 1,457,795 units
40,000 Jan-Dec 2010 = 1,645,304 units
320 % (Compared Nov’11) % Growth = - 11 % 23,695
- 28 % (Compared Dec’10) Plan 2011 = 1,794,486 units
20,000 - 31 % (Compared Plan) Actual < Plan = 19%
0
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Production 2011 Plan 2011 Production 2010
Source: Automotive Industry Club, FTI

17. The Trend

18. Automotive trend
Technological Direction for Vehicles
Thailand is
here!
18
18

19. Hybrid in Thailand
Hybrid Share
HV Sales
(Jan-Jun 2011)
Local HV
produced
HV Imported Cars starts
0.1%
6,821
CNG
E10
Bio-Diesel 5.6%
9.2%
47.9% 4,901
E20
13
36.8% 8
E85 3 4
0.4%
Total 432,012 units 2005 2006 2007 2008 2009 2010
<units>
 Hybrid
in Thai market is the smallest section, but its sales has dramatically
increased since its introduction phase.
19

20. 2011 Flood
&
Rehabilitations

21. Thai Government Supportive Policies in Flood 2011
Government promptly support the flood victims in automotive
industry
1. Exempt import duty of machineries.
2. Exempt import duty of auto-parts.
3. Exempt import duty of CBUs for factory that was flooded.
4. Provide soft loan to flood victims.
5. Commercial bank to relax and delay paying loan.
6. Support on moving machineries, tools and products out from flood
area.
7. Facilitate in issuing visa of foreign specialists who seek support on
flood matters.
8. Relax practices according to Alien Act. to enable foreign company to
help local flood victims.
21

22. Thai Government Supportive Policies in Flood 2011
22

23. Yes Thailand

24. Thai Automotive Outstanding Points
Hub of Pickup
Unique environmental
Unique Eco-Car
friendly vehicle (Eco-Car)
created by Thai govt.
Local Hybrid Vehicle
Hybrid Vehicle
production ie. Camry hybrid,
local production Prius and others are coming.
- Toyota Motor Asia Pacific Engineering & Manufacturing
Hub of
- Honda R&D Asia Pacific
automobiles & parts
Regional R&D center - Denso International Asia (R&D)
- Isuzu R&D
- Others 24

25. Thailand has largest and expanding production
25

26. Strength and Weakness of Thai Automotive Industry
Strengths
• Thailand is the hub of pickup and derivatives (Niche Product) of the world.
• Regional market is plentiful.
• Government has firm and consistent supportive policies ever since.
• Long experiences of basic technology and skilled labor force.
• Strong supplier networks.
• Industrial estates and infrastructure are well coordinated.
• (Peaceful political situation)
Weaknesses
• Disunity of government policies.
• Lack of own technology. (Innovation)
• Raw material and machineries. (R&D)
• Human resources. (Vocational skills)
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27. Summary
Good Supportive Factors that Thailand is more attractive for investment
Government  Attractive government incentives
Market  Considerable market size (65 Mil people)
 Gateway to 580 million people of ASEAN
 Spring board to China & India, GMS and BIMSTEC
Infrastructure  Good infrastructure network
Supplier  Rich pool of supporting industries
 Good access to raw materials
 Abundant quality labor forces
People
 Hospitality, friendly attitude and flexibility
Amenity  Low cost of living
 Delicious foods and Rich Culture, Arts & Craft.
 Attractive Heritage sites
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