General Motors just announced that they will wind down operations in its Southeast Asian hub in Thailand by the end of the year. This includes the selling of its Rayong plant, as well as the eventual end of Chevrolet vehicle sales in The Land of Smiles.
The Thailand market departure follows its exodus from other Asian markets such as Malaysia, Indonesia, and India.
Dwindling sales volume brought about by aging models and poor customer retention have led to the eventual failure of the brand in the market. A last-ditch effort to prime sales with the Wuling Almaz-based Captiva crossover resulted in dismal sales of only 530 units for Q4 of 2019; not even half of the 2,642 units imported from its Indonesian factory. It ended 2019 with only 15,161 vehicles sold in the market.
In a statement, the automaker said that they are “taking decisive action to transform its international operations, building on the comprehensive strategy laid out in 2015 to strengthen its core business, drive significant efficiencies, and take action in markets it cannot earn an adequate return”.
“I’ve often said that we will do the right thing, even when it’s hard, and this is one of those times. We are restructuring our international operations, focusing on markets where we have the right strategies to drive robust returns, and prioritizing global investments that will drive growth in the future of mobility, especially in the areas of EVs and AVs,” said Mary Barra, Chairman and CEO of GM.
As mentioned earlier, Chevrolet will not immediately end operations in the country as they will continue sales until the end of the year. However, GM and Chinese automaker Great Wall Motors will soon sign a binding term sheet for sale of the Rayong plant. With low plant utilization and low forecast volumes, GM stated that continued production at the site is now unsustainable.
“Without domestic manufacturing, Chevrolet is unable to compete in Thailand's new-car market,” said GM. Despite the eventual selling of the plant and the closing down of local operations, GM assured its customers that all warranties will still be honored. In addition, all recall and any safety-related issues will still be addressed by the company.
This recent development is expected to affect sales operations here in the Philippines. The Covenant Car Company Inc. (TCCCI), the official distributor of Chevrolet in the country, sources the Colorado pickup and Trailblazer SUV from GM's Rayong plant in Thailand. With the planned closure set by the end of 2020, this may be the last year that Chevrolet will be able to sell the Thai-made pick-up truck and SUV models in the country.