Thailand's Growing Economy Positively Impacts its Automotive Industry and the Steering Systems Market
The automotive industry in Thailand is one of the major industries in the country contributing substantially to its gross domestic product (GDP). "Most of the global automotive players, particularly the Japanese companies have assembly and/or manufacturing plants in Thailand," according to the analyst. "With considerable support in terms of incentives and subsidies from the Thai Government and related institutions, Thailand is expected to emerge as 'the Detroit of Asia Pacific'."
The automotive industry in Thailand is also focused on exports. Thailand exports vehicles to countries such as the United Kingdom, the United States, Australia, as well as to Middle East and several African countries. In addition, global participants such as Toyota Thailand have launched the Innovative International Multi-Purpose Vehicle (IMV) project in Thailand. Besides this, other global participants such as Isuzu and Ford-Mazda's Auto Alliance factory have also set up a pickup production line in Thailand. Thus, Thailand is gradually becoming a global production and export hub for one-ton pickup trucks.
Thailand's Liberal Investment Policies and its Trade Agreements with Many Countries is Expected to Drive the Steering Systems Market
In addition to its booming economy, Thailand's liberal investment policies do not pose any restrictions on foreign investors with respect to export requirements or foreign equity restrictions in manufacturing, local content requirements, and location requirements. In addition, the cost of setting up a business in Thailand is also relatively low. This encourages the entry of all major global automobile companies into Thailand. In order to strengthen the country's position as a 'global automobile hub', the Thailand Automotive Institute (TAI) has formed a $217.5 million plan. This includes five key projects, including a human resources development (HRD) program, an automotive experts dispatching program, a fund for the establishment of R&D centers, an information technology center to analyze industry trends and an automobile export promotion center. These facilities are expected to give tremendous impetus to the Thai automotive industry and thus to the demand for automotive components and parts such as steering systems.
Thailand has also entered into several Free Trade Agreements with other major international automobile markets such as Australia, New Zealand, China, and India. This is expected to boost the exports from Thailand to other countries. For example, Tata Industries, the major Indian auto producer is in the process of setting up a pickup truck manufacturing plant in Thailand, and this is likely to assist in penetrating the Association of Southeast Asian Nations (ASEAN) and the Chinese markets through the Free Trade Area (FTA) treaty. "These new developments have contributed toward Thailand's double-digit vehicle export growth over the past few years and the rising significance of Thailand as a regional automotive manufacturer and supplier," explains the analyst. "Several major global auto manufacturers depend on their Thailand operations to serve both domestic and regional demand."