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India, a hub for car exports to developed markets, is seeing serious competition from Thailand as production constraints and quality issues force manufacturers to consider production of critical models in the Southeast Asian nation.
Ford India is looking at shifting production of Fiesta, and Japanese manufacturer Suzuki is planning to move production of its newly launched Celerio from India to Thailand for exporting to developed markets, according to sources.
Ford's India unit is unlikely to export company's new compact sports utility vehicle EcoSport to North American markets, whose production will be moved to unit to the US automaker's Thai plant by 2016, according to recent reports.
Experts said EcoSport and Fiesta will mainly be exported to North American markets while Celerio will be exported to Europe.
Mayuree Chaiyuthanaporn, senior analyst, IHS Automotive Asean, who tracks Thailand automotive market, said, "Manufacturers are looking at Thai plants mainly because of India production constraint coupled with the better quality production in Thailand. Reportedly, Ford EcoSport produced in Thailand provide better noise, vibration, and harshness (NVH) levels. Meanwhile, export orders are likely to utilise Thailand's capacity to its maximum."
Thailand is a production base for pickups and small cars, with total capacity expected to reach three million units by 2019, highest in Southeast Asia. The production cost in Thailand can be reduced because of economies of scale. Completely built units (CBUs) export account for around 60% (2013) of total production output, according to IHS Automotive.
Atul Shahane, general manager, vehicle exports, Nissan Motor India, who has worked in Thailand said, "Manufacturing of pickups and small car segments get supported by the government in a big way. Thailand has better infrastructure and technology, while it also has some challenges in terms of political instability and natural calamities. However, quality of production is definitely better there compared with India."
The country also has the highest number of suppliers among Asean countries. The Thai Board Of Investment offers both fiscal and non-tax incentives for investments. Tax sops include exemption or reduction of import duties on machinery and raw materials, and corporate income tax exemptions and reductions.
India, a hub for car exports to developed markets, is seeing serious competition from Thailand as production constraints and quality issues force manufacturers to consider production of critical models in the Southeast Asian nation.
Ford India is looking at shifting production of Fiesta, and Japanese manufacturer Suzuki is planning to move production of its newly launched Celerio from India to Thailand for exporting to developed markets, according to sources.Ford's India unit is unlikely to export company's new compact sports utility vehicle EcoSport to North American markets, whose production will be moved to unit to the US automaker's Thai plant by 2016, according to recent reports.
Experts said EcoSport and Fiesta will mainly be exported to North American markets while Celerio will be exported to Europe.
Mayuree Chaiyuthanaporn, senior analyst, IHS Automotive Asean, who tracks Thailand automotive market, said, "Manufacturers are looking at Thai plants mainly because of India production constraint coupled with the better quality production in Thailand. Reportedly, Ford EcoSport produced in Thailand provide better noise, vibration, and harshness (NVH) levels. Meanwhile, export orders are likely to utilise Thailand's capacity to its maximum."
Thailand is a production base for pickups and small cars, with total capacity expected to reach three million units by 2019, highest in Southeast Asia. The production cost in Thailand can be reduced because of economies of scale. Completely built units (CBUs) export account for around 60% (2013) of total production output, according to IHS Automotive.
Atul Shahane, general manager, vehicle exports, Nissan Motor India, who has worked in Thailand said, "Manufacturing of pickups and small car segments get supported by the government in a big way. Thailand has better infrastructure and technology, while it also has some challenges in terms of political instability and natural calamities. However, quality of production is definitely better there compared with India."
The country also has the highest number of suppliers among Asean countries. The Thai Board Of Investment offers both fiscal and non-tax incentives for investments. Tax sops include exemption or reduction of import duties on machinery and raw materials, and corporate income tax exemptions and reductions.
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