Industry News

Macro Economy and Foundry-related Industries of Thailand
【Southeast Asia Market Information】METAL AP 2019 invites you to exhibit in Thailand for more business opportunities!
Macro Economy and Foundry-related Industries of Thailand

 
FOREWORD
ASEAN population in 2017 reached 642.1 million with a workforce of over 323.62 million (50.4%). ASEAN GDP per capita reached US$ 4,307 with a YoY increase of 6.46%. The demographic dividend and climbing power of consumption are accelerators for Southeast Asia to be one of the fastest growing and developing areas in global manufacturing industries. In addition to promising future of local auto industry with production and sales volume in 2022 expected to be 4.96 million and 4.65 million units, governments of these countries has increased investment on and quickened the progress of local infrastructure projects. All of these factors has generated extremely huge demand on metal parts and complete sets of manufacturing equipment.

Since its successful debut in year 2018 in Thailand, METAL AP has been highly appreciated and supported by industry insiders. The second METAL AP keeps improving on all sides to meet expectation of exhibitors, trade visitors, partners and supporters. At the same time, China Foundry Productivity Promotion Center, the organizer of METAL AP, will continue providing information about macro economy and foundry-related industries of Southeast Asia for your ease to discover more chances.

MACRO ECONOMY OF THAILAND

General Information
Thailand is a constitutional monarchy in South East Asia that consists of 77 provinces spreading across six regions: North, North East, Central, East, West and South.
◾Population: 67.20 million (2014).
◾Area: 513,120 km sq.
◾Total export value: 225.784 USD billion with an increase of 6%; 6% of global export value.
◾Total FDI: 12.7 USD billion with an increase of 20.93%; Japan is the top 1 investor (60.6%).
Source: World Bank, International Trade Center, Bank of Thailand

Industry and Workforce
◾ Labor costs in Thailand is relatively low compared with other countries in the area such as Malaysia and Indonesia while productivity levels remain high. Investors agreed that Thailand is a very cost-effective place to do business.
◾ The stable and steady workforce in Manufacturing sector has been attributed to the growth of the industrial manufacture in Thailand.
◾ At present. Thailand is host to almost 3 million migrant workers from neighboring countries.
GDP
Thailand witnessed 0.7% growth in GDP in 2014 (373.8 USD billion). Main contributors towards the GDP growth are Services and Manufacturing sectors with 48.2% and 38.2% share respectively of the total GDP.
Source: knoema.com, data.worldbank.org

FDI
◾ Foreign investors are attracted by Thailand' strong growth in the past years, low cost labor force and significant performance of its manufacture industry.
◾ China is the second largest FDI investor to Thailand in aspect of accumulative investment from 2014 to 2017.
Source: UNCTAD, Indexmundi, Ministry of Foreign Affairs-Thailand

Exchange Rate
It is observed that there has been an appreciation of THB vs. US dollar since 2005, caused by Thailand's investment capital which kept increasing dramatically and other measures to attract investment such as high interest rate, etc. 
Source: dragonsourcing.com

FOUNDRY-RELATED INDUSTRIES OF THAILAND

Machinery and Parts
◾ In 2014, the trade value of machinery and parts reached US$22.91 billion, nearly a 130% increase from 2009 levels. The biggest sector was industrial machinery (74%), followed by machine tools (18%) and agricultural machinery (8%).
◾ Despite continued growth, developmental gaps are still apparent in the industry, as the production of high complex and precise technological machinery is still in short supply in Thailand. The ongoing development of Thai manufacturing has generated huge demand on industrial machinery import.
Source: Machinery Intelligence Unit, Iron and Steel Institute of Thailand
◾ In 2013, nearly 0.4 million workers and 50,000 companies have been involved in machinery and metalworking sectors.
◾ Some of industrial machinery manufacturers include: Toshiba Carrier (Thailand) Co., Ltd., Korawit Engineering Ltd., Bangkok Fastening Co., Ltd., Kulthorn Kirby PCL., Global Thaixon Precision Industry Co., Ltd., Kusatsu Electric (Thailand) Co., Ltd., Thai Agricultural Machinery Co., Ltd.
Source: boi.go.th, business-in-asia.com
Mould & Die
◾ According to a department of Thai-German Institute there are approximately 4,207 companies registered with the institute and involved in the mould and die industry in Thailand.
◾ A majority of moulds and dies are utilized by Thailand's automotive and E&E industries. Local mould and die manufacturers are able to meet an local demand from Thailand's downstream industries; however, it still leaves a significant opportunity in the market for higher quality mould and die imports from foreign manufacturers.
◾ In 2014, Thailand imported US$ 1.26 billion worth of moulds and dies. Major sources of mould and die imports are Japan, China, Korea and Taiwan China.
Source: Machinery Intelligence Unit, Iron and Steel Institute of Thailand, boi.go.th

Electrics and Electrical Industry
◾ Thailand is one of ASEAN's largest production centers in the electrical appliances sector, the world's second largest producer of air conditioning units and second largest global producer and exporter of hard disk drives.
◾ The electrical and electronics industry is a main growth driver of Thailand's economy. In 2017, the electrical and electronics industry accounted for 25% of Thailand's annual export revenues.

◾ Currently, over 600,000 people are employed in Thailand's electrical and electronics sector.
◾ Many global electrical appliance and electronics manufacturers that already have plants in Thailand, including: Fujitsu, Seagate, Sony, Western Digital, Bosch & Siemens, Daikin, Electrolux, Fisher&Paykel, Haier, LG, Panasonic, Samsung, Toshiba, etc.
Source: International Trade Center, boi.go.th

Automotive and Auto Parts
◾ In 2016, Thailand is the first automotive producer in Southeast Asia, second one-ton pickup producer, the sixth commercial vehicle producer and the twelfth automotive producer in the world.
◾ The industry contributed 12% of the GDP with more than 1.94 million vehicles produced and worth USD 27 billion in 2016. Thailand expects to increase its production to 3,500,000 motor vehicle units in 2020.
△2016-2018 Automobile and Motorcycle Production & Forecast

【Industry Structure】
◾ Assemblers: 18 car assemblers and 9 motorcycle companies. Nearly every Japanese car makers and many leading US, Europe, and China automotive companies have their production plants in Thailand. 
◾ These auto assemblers also attracted more than 710 tier 1 auto part makers and 1700+ tier 2 & 3 supporting companies to the country.
◾ In 2016, 700,000 people were involved in this sector. 


【Auto Assemblers】
◾ 85% of the market share is controlled by Japanese, and about 5% by US OEMs.
◾ Toyota have the biggest share of about 35% in the vehicle market, followed by Mitsubishi, Auto Alliance, Nissan, Isuzu, Honda, Chevrolet and Suzuki at 25%, 11%, 9%, 5%, 8%, 3% and 3% respectively。​
Source: dragonsourcing. com, boi.go.th

【Auto Part Suppliers】
More than 60% of 100 largest auto part suppliers in the world have their production hub in Thailand.


 

【Investment Incentives】Companies engaged in development and production of automobile and auto parts in Thailand may enjoy corporate income tax exemption for 0-8 years and exemption of import duty. For details, kindly check with BOI.
Source: boi.go.th

Aerospace
◾ In 2034, Asia-Pacific as a whole will account for 42% of global passenger traffic. Given its immense growth potential, many world-class aerospace companies are looking to expand and locate their business in the Asia-Pacific region.
◾ Thailand's air traffic is rising at 3 times faster than the global market. It has increased at an average annual rate of more than 13%.
◾ Commercial airlines' MRO expenses are estimated to reach USD 12 billion by 2024 in Asia-Pacific. Over 2015-2024, Thailand's MRO expenditure has been forecasted to reach a total amount of USD 10.6 billion.
◾ Thailand's present MRO focus is on components, engines, and line maintenance; the top five components that are LG wheels & brakes, APU, IFE components, engine-fuel and control, and landing gear. There five components have been forecasted to generate more than USD 1.7 billion from 2015 to 2024.
【Investment Incentives】Companies producing airline or parts may enjoy corporate income tax exemption for 8 years and exemption of import duty. For details about non-tax benefits, kindly check with BOI.
Source: boi.go.th

Automation and Robots
◾ Thailand ranked eighth in global supply of industrial robots in 2014.
◾ The size of Thailand's shipments of industrial robots is estimated to increase by 133% from 2,131 units in 2013 to 7,500 units in 2018.
◾ Major automation and robotics companies in Thailand including NACHI, Delta, ABB, UREKA, Daifuku, Celestica, YASKAWA, FESTO, Agilent Technologies, KUKA, FANUC etc.
Source: boi.go.th

Organic Chemical
◾ Organic chemicals' exported growth in value of Thailand between 2010 and 2014 is 10% per annum.
◾ There are about 750 organic chemical suppliers in Thailand. Many big manufacturers are located in the east part of Thailand.
◾ Aditya Birla Chemicals (Thailand), Sumitomo Corporation Thailand Ltd., Union Petrochemical Public Co., Ltd., Pimai Salt Co., Ltd., ARS Chemical (Thailand) Co., Ltd. Thai Caprolactam Public Company Limited, Siam Water Flame Co., Ltd., ICP Chemicals Co. Ltd., SQI Group of Companies, Imperial Industrial Chemicals (Thailand) Co., Ltd., Cape Industrial Co., Ltd. (Cape Thailand Eastern Branch), PAE Public Co., Ltd., Technip Engineering (Thailand) Ltd., Thai Organic Chemicals Co., Ltd. are various suppliers in Thai market.
Source: International Trade Center, aboutthailand.info, chemtechsearch.com, business-in-asia.com

Iron and Steel Products
◾ Iron and steel products' exported growth in value of Thailand between 2010 and 2014 was 7% per annum.
◾ Construction industry is the major end user of iron and steel products with about 54% followed by automobiles and parts at 16%, machinery and industrial products at 13%, electrical appliances at 12% and packaging at 5%.
◾ Sahaviriya Steel Industries Public Company Limited (SSI), Bangkok Steel Industry Co., Ltd (Public), Millennium Steel Public Company Limited, Siam Construction Steel Company Limited, Siam Iron and Steel Company Limited, Thai Special Steel Industry, Thai Stainless Steel Co., Ltd. are major players in Thai market.
Source: International Trade Center
CONCLUSION
Demands bring opportunity; platform facilitates development. The fast-growing and promising machinery, electrics & electrical, automobile & motorcycle, aerospace, automation & robots and other manufacturing industries of Southeast Asia, especially Thailand, has generated huge demands to be met by upstream industries like die casting, foundry, furnace and metallurgy.

METAL AP is the first die-casting, foundry, furnace & heat treatment, metallurgy platform of Southeast Asia. The first METAL AP which was successfully held on September, 2018 in Bangkok, Thailand, has enabled organizers and partners at home and abroad to gather rich and effective practice experience, which has laid solid foundation for METAL AP 2019. This year, METAL AP will be improved on all sides. It is your best choice to exhibit in Thailand!





CONTACT
China Foundry Productivity Promotion Center (FPC)
Foundry Institution of Chinese Mechanical Engineering Society (FICMES)

 
Ms. Gillian Li
Tel: 86 24-25855793
Email:lmt@foundrynations.com
 
Ms. Lindsay Bao
Tel: 86 24-25855720
Email: baolinlin@foundrynations.com 

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Venue
Bangkok International Trade and Exhibition Centre (BITEC)

Date & Opening Times 
Dec. 12, 2019 10:00-18:30
Dec. 13, 2019 10:00-18:30
Dec. 14, 2019 10:00-15:00