Toshiba sharply lowers growth estimates

"There are many negative concerns for 2009, as Thai consumers are spending less, for no obvious reason. They are scared of unknown developments. The spending mood is not so good, as they don't know what will happen in the future," said Hidenori Matsui, president of Toshiba Thailand.

He said the company estimated its growth for fiscal year 2008, ending in March, to be at 14 per cent to about Bt5 billion. In the first six months, it posted a 20-per-cent growth rate.

The growth, however, declined heavily to only 5 per cent in October and November and to only 3 per cent in December alone.

Matsui was confident of reaching the new sales targets by maintaining promotional budgets and launching innovative products with different colours and designs. The company recently launched its new mini-notebook computer at just Bt16,900.

"What we have done at this time of economic difficulty is to reduce our operating expenses as well as working hard to maintain and expand our sales. We need to be a very efficient operation," Matsui said, expressing that consumers should restart spending again by April or June this year.

"The government is on the right track in launching a campaign to stimulate domestic consumption, as the current situation in Thailand needs that kind of stimulus package. We don't think that this year will be as bad as 1997, when Thailand and many countries in Asia suffered heavily from the financial turmoil," he said.

Kobkarn Wattanavrangkul, chairman of Toshiba Thailand, said that in addition to encouraging domestic consumption, the Abhisit government would also require support from foreign investors.

To boost the company's sales, it would use Doraemon, a well-known Japanese cartoon character, in advertisements. The new character celebrates Toshiba's 40th anniversary in Thailand.

"Doraemon is a future robot of the 22nd century. He brings hope and dreams, surprises and inspiration, to the people. It is quite appropriate for the economic situation in Thailand at this time," Matsui said.

Kanit Muangkrachang, vice president of Thai Toshiba Electric Industry, which is responsible for the company's Nonthaburi factory, said the global economic downturn had led to a drop by almost 20 per cent in export sales in December alone.

It has seen a good rebound in sales target this month.

Toshiba's Nonthaburi plant manufactures one-door refrigerators and other home appliances. They also export products such as refrigerators back to Japan and to other markets.

"We have set a zero-growth target this year as our worst-case scenario and to help us to closely control our operating costs. We have adjusted our resources and raw materials based on the projection," Kanit said.

She said the company would maintain its skilled people as much as possible.