Siam GS upbeat on outlook
Siam GS Battery, an affiliate of Siam Motors Group, remains optimistic about its car battery shipments amid bearish exports and the baht’s appreciation.
Siam GS Battery produces lead-acid batteries at Bangpoo Industrial Estate in Samut Prakan with a capacity of 4.5 million units annually.
Theerapong Kasemarnontana, assistant managing director of Siam GS Battery, said 75% of the capacity is allocated for local sales to car manufacturers and replacement markets. The rest is set for exports to Japan, Myanmar, Laos, Cambodia and Malaysia. Japan orders 200,000 batteries per year.
Siam GS Battery expects to beef up overseas shipments to account 30% of production capacity within five years.
“The strong baht puts pressure on export value. Lead has to be imported, so we benefit from cheaper imports, offsetting the export loss,” said Mr Theerapong.
“We can take advantage of lead prices in the global market, projected for further decline this year from US$2,000 per tonne.”
He said the company has set aside 350 million baht to improve its manufacturing lines and increase its production capacity by another 500,000 batteries this year.
The Samut Prakan plant plans to have capacity of 5 million batteries, in line with the three-year plan for 2018-20.
“We expect to achieve 5 billion baht in 2020 revenue,” said Mr Theerapong.
Established in 1968, Siam GS Battery is a joint venture between Siam Motors and Japan’s GS Yuasa Corporation.
Siam Motors owns a 40% stake while the Japanese counterpart holds a majority stake.
It also has plants in Myanmar and Malaysia.
Siam Motors has another affiliated firm, Siam GS Sales, overseeing the local sales of GS Battery for the replacement market.
Prakasit Phornprapha, president of Siam GS Sales, said 2020 should be a flat year for the company because of Thailand’s shrinking auto industry.
The country’s car production is projected at roughly 2 million in 2020 for both local sales and exports, with slight drops from 2019.
“Although Thailand has new registered cars every year, car batteries for the replacement market are sluggish in line with bearish exports, low GDP growth and high household debt,” he said. “Motorists are waiting to change batteries.”
Siam GS Sales expects to achieve revenue of 3.8 billion baht in this fiscal year, ending in March, up 30% year-on-year.
Mr Prakasit said GS Battery makes up a 35% share in the local replacement market, while other competitors are 3K Battery and FB Battery.