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Published on September 21, 2007

The Industry Ministry and the Thailand Automotive Institute will propose to the next government that it support the development of a car testing centre and testing field.

The plan involves using Bt6 billion of the excise duties collected from the automotive industry last year.

Industry permanent secretary Chakramon Phasukavanich said both the testing field and testing centre were necessary if the government really wanted to promote the automotive industry.

At a press conference yesterday after a public hearing on the auto industry's development master plan for 2007-11, Chakramon said the government should take the lead in this project, which would support the launch of new models by auto companies in Thailand. Such an investment would improve competitiveness among local parts manufacturers and suppliers in the first and second tiers.

"Importantly, this project will strengthen our automotive and auto-parts industries in the long run and is in line with the Industry Ministry's intellectual-property and productivity plans," he said.

The previous government rejected the proposal, due to the huge investment involved, but now the auto industry believes it has enough data to convince the next government of the investment's potential.

Chakramon said the new plan would send a clear message that Thailand was committed to long-term investment. To increase the probability of success, the investment would be divided into three phases over three years, so that the required budget could be apportioned gradually. During this period, the government would earn interest from the loaned amount, while the testing centre and testing field would earn fees collected from auto and auto-parts manufacturers using the venues.

Chakramon noted that last year, the government collected Bt55.9 billion in auto excise duties and that there should thus be no problem with lending Bt6 billion to boost the industry's competitiveness and standards.

"Finally, the higher the quality of the products, the more in taxes the government will earn," he said.

Both the testing centre and the testing field will take three or four years to build.

The auto master plan sets to boost annual production from 1.6 million vehicles now to 2 million in 2011.

Sutham Vanichseni, a representative from consulting company SVI Initiatives, said his company's competitive strategy was to develop a lean supply chain throughout the local automotive industry and expand markets of pickups, eco-cars and auto parts in the domestic market and elsewhere in Asean.

Moreover, it will promote outbound investment and international linkages to approach target groups and transfer technological know-how.

He added that the government's policy would be more synergistic and responsive with this model scheme.

Chalida  Ekvitthayavechnukul

 The Nation