TRADE MARCHES ON

Despite the ongoing protests, Thailand remains keen on the potential of Hong Kong and is negotiating a bilateral trade deal.

Thai Summit Group, one of the country’s biggest auto parts makers, says its plant in Laem Chabang is still in operation after suspending some manufacturing units and laying off 100 employees for two months.

Thai Summit Automotive Co announced on Oct 21 that it would stop some units at the Laem Chabang plant from Oct 26 to Dec 25, citing sluggish orders from car makers.

The 100 employees will get paid a salary of 75% the normal rate during the suspension. The payment complies with the Labour Protection Act.

Chanapun Juangroongruangkit, the group’s vice-president, said the plant has a total workforce of 800 employees and the temporary suspension was certified by the Provincial Office of Labour in Chon Buri.

“It means that the plant has 700 people, while the group and the plant’s labour union have agreed with this measure,” she said. “Moreover, we allow the existing workers to take one day off per month. As a matter of fact, there is no overtime payment for two months. Some employees are happy, some are not. Normally the administration level does not get paid OT.”

Ms Chanapun said Thai Summit has seen declining purchase orders from car makers with facilities in Thailand.

“We need to suspend some operating units because auto parts suppliers use a just-in-time process to deliver products to buyers, and when the car makers cut their orders, we have to do so,” she said, adding that the group cannot make a huge stock and wait for new orders.

Ms Chanapun said the news about the suspended operations at Thai Summit caused an overreaction. The announcement came after a downgraded projection of the country’s 2019 automotive output from 2.15 million vehicles to 2 million.

“The new projection is down 7.7% from the previous one, so the current situation is sluggish in line with other industrial sectors,” Ms Chanapun said, blaming the business cycle.

She said next year will bring issues that are hard to predict for the automotive industry: “The bearish economy and exports could pressure car production in 2020.”

Thai Summit has a five-year business development plan running from 2017 to 2021, with the ambitious goal of becoming one of the top 100 global automotive suppliers by 2021.

Under the plan, sales at home and abroad are expected to surpass 100 billion baht.

Founded in 1977 by Ms Chanapun’s parents, Thai Summit Group has 40 subsidiaries in nine core business divisions spanning cars, motorcycles, agricultural machinery and golf carts.

The group has 20,678 employees and operations in the US, Japan, Vietnam, Indonesia, China and India.