Thursday, March 31, 2011

Thailand to launch National Flying Eco-Car Project


Obviously Thailand wants to take over to become the leading Asian Carmaking Country while Japan struggles to restart it's damaged factories and China's car industry is clearly doomed as they are waiting for earthquake proof new nuclear reactors from Germany, which yesterday decided to shut down their nuclear power plant production industry in the wake of this months events:
Thai Automotive Industry spokesman Kanote Fleisabei announced the new Government Car project which has been jointly developed by leading Thai Automotive Suppliers at a meeting with AFG blog writer Uli Kaiser in Bangkok.
"This exciting program will put our country at the forefront of technology allowing personal airborne transit. Technologywise we go totally green combining new breakthrough hybrid palmoil-tapioca engine technology with a chassis  built 100% from coconut and it's byproducts, meaning: we save the planet and also fly quickly around Thailand instead of waiting in the traffic jam." 

The design team in Saraburi has finished the first prototype of the FLYBYNITE model currently tested in Londons traffic. Future developments include the flying pick up truck and a flying motorcycle for Pattaya's congested streets.

The Flybynite Prototype developed in Saraburi spotted doing test flight in London

Wednesday, March 30, 2011

Japan could cause auto supply chain rethink

DEARBORN, Michigan (Reuters) – The parts shortages and resulting production shutdowns caused by the Japanese earthquake and tsunami could cause the global auto industry to rethink how it sets up its supply lines, a top industry economist said on Tuesday.
"What this says is that there might be some cracks, some inefficiencies, some unplanned-for problems not only in nuclear power plants, but in our global supply system for the auto industry," Sean McAlinden, chief economist for the Center for Automotive Research, said at a conference here.


Japan disaster to hinder Thailand's car production

Thailand may be expected to pick up the slack of the stricken auto industry following the March 11 earthquake and tsunami that hit Japan but car company executives from the Southeast Asian country say they were also affected by the double disaster.

According to Prachin Eamlumnow, chairman of Grand Prix International Co. Ltd. that organizes the Bangkok International Motor Show, Thailand's automotive manufacturing industry will feel the effect of the Japan disaster for about three months starting this April.

World Bank: Japan rebuild may take 5 years

Japan may need five years to rebuild from the catastrophic earthquake and tsunami that has caused up to $US235 billion of damage, the World Bank said on Monday.

The March 11 disaster - which killed more than 18,000 people and ravaged northeastern Japan - will likely shave up to 0.5 percentage point from the country's economic growth this year, the bank said in a report. The impact will be concentrated in the first half of the year, it said.

MANILA BULLETIN: Japanese car assemblers facing supply problem

MANILA, Philippines – The country’s automotive assemblers have advised the Board of Investments (BoI) they may face supply problem should Japan’s supply chain cannot get back on their feet in a month’s time.

TMP vice president Rommel Gutierrez said these Japanese CBU imports from Japan account for 10 percent of its total sales. Although some of TMP’s auto parts for its CKD assembly here are imported from Thailand, some tier 2 and 3 assembly parts are imported from Japan.

Asean the prime candidate for relocation

Southeast Asia will be the destination of a new wave of Japanese investment as the world's third-largest economy has to rethink its industrial strategy, as well as its energy policies, says Sompop Manarungsan, president of the Panyapiwat Institute of Technology.

JAPAN 'QUAKE: ASEAN affected by parts supply disruptions

Thailand’s automotive industry expects to resume normal production after the Thai New Year holidays on 18 April, after overtime was suspended at many vehicle assembly plants in the country in the immediate aftermath of Japan’s devastating earthquakes and tsunamis.

The Federation of Thai Industries estimates lost production to date at around 10,000 vehicles, as the industry cut overtime in anticipation of potential parts supply shortages in Japan. The federation expects this number will eventually amount to tens of thousands of units as supply chain disruption forces more downtime. It estimates the current production loss at around 5,000 vehicles per week.

M&C: South-east Asia's auto industry sees gain from Japan's pain

Bangkok/Jakarta - South-east Asia's integrated automotive assembly line has suffered a slight hiccup from Japan's earthquake disaster, but the disruption may benefit the region's auto industry in the long term, industry sources said.

Thailand's auto industry unphazed by Japan Disaster

Thailand’s auto industry will continue growing higher than previously expected this year although Japan, which is the major manufacturer and distributor of auto parts, has taken a huge toll from the recent earthquake, according to a top Thai industry executive.

Click here for the full story.

China/Germany: Dongfeng eyes stake in Getrag – report

China's Dongfeng is planning to buy 30% in Germany's GETRAG….here go the crown jewels...

Tuesday, March 29, 2011

CNW: Risk is biggest in Thailand

…..In fact, Asia (including Japan) now produces more than 55 per cent of all new vehicles assembled globally, up from only 30 per cent a decade ago.  On a per vehicle basis, the risk is greatest in Thailand, with each assembled vehicle containing more than US$1,714 of Japanese-made auto parts. In fact, Japan accounts for more than 57 per cent of all auto parts destined to Thailand - a nation that produced 1.6 million cars and trucks last year, a level rapidly approaching the 2 million units assembled in Canada last year. Taiwan also imports more than half of all its auto parts from Japan, while shipments to the Philippines and China exceed 40 per cent of their overall auto parts imports….

Click here for full story.

THE NATION: Watch out for Indonesia, warns industrialist

Thailand's automotive industry is likely to face fierce competition from Indonesia once domestic production there reaches a certain level, but foreign investment will keep pouring into Thailand, given policy stability and continuity, according to automotive industrialists.

Thanathorn Juangroongruangkit, executive vice president of Thai Summit Group, the country's leading auto-parts manufacturer, said yesterday that it was possible for Indonesia to become the biggest automotive manufacturing base in Southeast Asia before the end of 2019.

Click here for the full story.

STAR ONLINE: VW to make Pekan regional hub, plans to make 30,000 vehicles by 2018

WOLFSBURG (GERMANY): DRB-HICOM Bhd's tie-up with German automotive giant Volkswagen AG (VW) to manufacture VW cars at the former's plant in Pekan, Pahang is expected to create 800 new jobs within the next two years.

International Trade and Industry Minister Datuk Seri Mustapa Mohamed, who met representatives from VW AG here on Monday, said the German car company expected to produce more than 30,000 (VW) vehicles at the plant by 2018.

Click here for the story.

Business World Online: Bangkok matters

….arguably, motor shows are legion when it comes to compact pickup trucks but none of these shows, with or without red vs. yellow shirt rallies, can ever overshadow Bangkok’s.

In Thailand the four-door crew cab pickup truck is as common as a four-door compact sedan, taking 43% of national motor vehicle registrations. This is why the Gulf states, Latin America, ASEAN and India all look to Thailand for the latest in LCV trends. Why a truck? Besides the tax incentives, Thailand’s biannual monsoon season means a vehicle has to have the ability to wade through flash floods….

Click here for the article.

BANGKOK POST: Local automakers stung - But production targets remain unchanged

Local carmakers estimate the overtime stoppage begun two weeks ago in the wake of the Japanese disaster has cost them 10,000 vehicles to date, but normal production is expected to resume after next month's Songkran holiday.

Click here for the article….

BANGKOK POST: 325 Thai firms hit by Japan disasters

More than 100,000 workers in 325 Japan-linked firms in Thailand have been affected by the three-pronged disaster in Japan, Labour Protection and Welfare Department director-general Amporn Nitisiri said on Tuesday.

Mrs Amporn said there are 767 companies in Thailand with major Japanese shareholders. These firms employ about 471,500 workers.

Of these, 325 have been affected by the disasters in Japan. They employ altogether 108,808 workers. Most of these firms produce and distribute automobile parts, electronic parts and food products.

These companies have begun cut backs, ranging from reducing overtime working hours, reducing productivity, and reducing working days. Some employers had opted to invoke Section 75 of the labour law by asking employees to stop working and receive only 75 per cent of their regular salary, said Mrs Amporn.

Mrs Amporn said that some food and farm produce processors in Chiang Mai and auto parts manufacturers in Chon Buri have actually benefited from the Japanese disasters as their parent companies in Japan had to halt their operations and ordered their subsidiaries in Thailand to increase  productivity to compensate

Sunday, March 27, 2011

ENGINEERING TV: Opposed piston opposed cylinder (OPOC) engine

Cool news from the "technology department". 4 x power from the same mass: Check out this video about the new  extremely lightweight opposed piston opposed cylinder (OPOC) engine, developed under a Defense Advanced Research Projects Agency (DARPA) program.

BANGKOK POST: Auto tax reforms flawed

The pending change in the automobile tax structure is flawed and not well thought out, according to executives of car companies based in the Thailand.

Under the new structure proposed by the Excise Department, vehicles emitting carbon dioxide levels between 150 and 200 grammes per kilometre would face a 30% tax rate. Any car exceeding 200g/km would be subject to a five-point hike; anything below 150 would get a five-point reduction.

Attractively priced eco-cars are affecting market for used-car loans

The growth of used-car loans this year is expected to be flat or slow because of the arrival of eco-cars, whose prices and interest rates are more attractive, according to Thanachart Bank, the market leader in vehicle loans.

THE NATION: Thai Stanley plans BT1.8 billion plant to cater to eco-cars

Thai Stanley Electric, Thailand's largest manufacturer of lighting equipment for the automotive industry, will invest more than Bt1.8 billion in a new manufacturing plant to produce lights for eco-cars.

Executive vice president Apichart Leeissaranukul recently said the company was evaluating the cost of the investment into the facility, which will be located at the main manufacturing centre in Ladlumkaew, Pathum Thani.

Paul Tan's Automotive Blog

More than 18,000 fans 'like' this Malaysian Automotive Blog by Paul Tan:

"Paul Tan's Automotive News was founded by Paul Tan in 2004. What started off as a hobby and a passion for cars has since grown into Malaysia's number one motoring website with a professional, unbiased and passionate team."

Saturday, March 26, 2011

Interview with MAI: "If Malaysia is not careful, we can be marginalised."

THE Malaysia Automotive Institute (MAI) is an agency under the International Trade and Industry Ministry (Miti) that was established as the focal point and coordination centre for the development of the local automotive industry.

In an interview with the StarBizWeek, MAI chairman Datuk Kamaruddin Ismail (KI) and CEO Madani Sahari (MS) speak on what the body has been up to and its plans for the country's auto sector. Click here to read the interview.

Datuk Kamaruddin Ismail

Ford to produce Ranger pickup truck in Thailand from mid-year

Ford Motor Company on Wednesday announced plans to start production of its new Ranger pickup model in Thailand by mid-2011, barring major disruptions in parts supplies from disaster-hit Japan.
Ford, which has a joint venture with Mazda Motor Corp to manufacture one-ton pickup trucks in Thailand, has been monitoring the earthquake, tsunami and nuclear disasters in Japan to see how they impact the flow of automotive parts from Japan-based suppliers to their factory in Thailand.

THE CHINA POST: Disaster-recovering industries only looking at short-term bottlenecks

It will take time, possibly around six months, before the Japanese automotive and other industries hit hard by the March 11 earthquake and tsunami will achieve a full recovery. However, most partial operations could be resumed much sooner, as early as the start of April.

Regarding the auto industry in Thailand, where Japanese firms are among the major players, there will be short-term negative impacts due to the shortage of some parts and components from Japan. This disruption is happening at a time when demand for locally-assembled vehicles continues to grow strongly, with production targets for both domestic and export sales projected to rise by 20 percent from last year's figures.

Thursday, March 24, 2011

BANGKOK POST: Producers forecast Q2 sales dip on Japan quake

Sales of new vehicles could decline slightly in the second quarter as local manufacturers experience delays in obtaining supplies from Japanese parts makers affected by that country's earthquake and tsunami.

Piengjai Keawsuwan, the vice-president of Siam Nissan Automobile, said its sales target of 74,000 units this year might be affected because of problems securing high-tech parts from Japan.

Wednesday, March 23, 2011

Production still on track

Production disruptions stemming from the disaster in Japan will not affect Thailand's goal of manufacturing 1.8 million cars this year, says the Thailand Automotive Institute.

''Many companies in Japan have already resumed production. The electricity is back on, and I think the situation will return to normal very soon, hopefully this week or next. Auto parts can then start being shipped here again,'' said director Vallop Tiasiri.

Monday, March 21, 2011

USA TODAY: GM production halt, layoffs in N.Y. due to Japan disaster

General Motors today stopped production at the Tonawanda plant in Buffalo, N.Y., that makes engines for the Chevrolet Colorado and GMC Canyon pickups. Assembly of the pickups was halted last week in Shreveport, La., because of a shortage of parts.

DAILY FINANCE: Most Toyota Plants in Japan Remain Idle

Toyota Motor (TM) reportedly won't resume vehicle production at any of its plants in Japan on Tuesday, as the automaker had planned. The continued stoppage leaves in question just how soon the world's largest automaker will be able to resume operations in its home market, following the March 11 earthquake and tsunami.

See full article from DailyFinance:

CTV: Japan’s auto production losses to rise as suppliers are affected

Japan auto makers in the first two weeks after the March 11 earthquake and tsunami will lose about 65 per cent in light vehicle production, industry consultant IHS Automotive Insight said Monday in a report.

Japan output is normally about 37,200 vehicles per day, or about 521,000 in a two-week period. IHS said that nearly 338,000 vehicles of that production through Friday will have been lost.

JAKARTA GLOBE: Thailand Leads Southeast Asia in Vehicle Sales

Pluak Daeng, Thailand. Half a world away from the cold streets of Michigan, General Motors is getting ready to roll its first diesel engine out of a recently opened factory in eastern Thailand. Nearby, Ford Motor is building a manufacturing plant and Suzuki Motor aims to start producing environmentally friendly cars at a new factory in 2012.

Seems like this article has been syndicated and appeared in many newspapers around the world.

Annual NAPA Tool and Filter Sale and Car Show at Kent Rylee Automotive Solutions

We want the public to know this is just the first of many exciting events you will see this year from Kent Rylee Automotve Solutions.  We are excited to have joined the NAPA family. The NAPA Tool and Filter Truck Sale and Car Show is our first major promotion for 2011.  Join Us April 7th and 8th for Huge Discounts on Tools, Filters and More.  And come April 9th for our car show.  For more information go to

Kent Rylee Automtive Solutions offers five distinct automotive services that include: a full-service NAPA AutoCare Facility to meet any vehicle service need, a full-service NAPA Auto Parts Store to provide any vehicle part needed, a Complete Collision Repair Center to restore vehicles to new, Northwest Arkansas’s Most Dedicated Preowned Dealership specializing in finding just the right used car at the right price and we are a full service tire dealer carrying a huge brand selection.

Kent Rylee Automotive Solutions is located at 2100 S. 8th street in Rogers. We also now have the NAPA Parts store in Bentonville.  To find out about upcoming events and the latest news at Kent Rylee Automotive Solutions log on to For more information contact Stephanie Orman at 417-766-4838 or

Creating 'Chinese' brands now 'part of the deal' for foreign automakers

Last December I wrote about a trend among Chinese-foreign automotive joint ventures in which the foreign partner gives technology to the JV to sell under a Chinese brand. Some of the English language China auto blogs refer to these as "sub-brands."

For example, Honda contributed the design of an outdated City vehicle it no longer makes to its JV with Guangzhou Auto. The JV now sells it under the Chinese brand Linian.

At the time I noticed this trend among several automakers (Guangzhou Honda, Dongfeng Nissan, Shanghai-GM), my assumption was that this was an attempt on the part of the Chinese automakers to wean Chinese consumers away from foreign brands. Chinese consumers still overwhelmingly prefer foreign brands (if they can afford them), because they perceive them to have higher quality.

Now several other foreign automakers including Volkswagen and PSA Peugeot-Citroen are discussing similar arrangements with their Chinese partners. PSA Peugeot-Citroen's CEO told the Financial Times that helping their partner to develop a local brand is now "part of the deal".

Last December I speculated that this may have been under central government coordination, but I had no evidence of that. Today, evidence seems to have surfaced in this report from the Financial Times.

The story quotes Mike Dunne, formerly of JD Power in China, who now has his own consulting company:
Nothing is written down, but when automakers go to apply for capacity expansion, in their application it’s clear that they should have a plan for an indigenous brand with jointly owned product rights and some provision for new energy vehicles. Foreigners want more capacity; China is saying: ‘We want more own brands’.
Back in 2001, when China joined the WTO, they gave up the right to demand technology transfer as a condition for approval of foreign investment. Of course, this new rule did nothing to change China's appetite for foreign technology.

The new demand, rather than for "technology transfer", appears to be: if you want to expand capacity, then X% needs to be devoted to Chinese-branded cars.

The foreign automakers now have a choice. They can pour precious R&D money into joint development of cars that compete directly with their own, or they can just hand over technology they already have.

The technology the foreigners are now handing over may be slightly outdated, so the foreigners aren't being forced to hand over their latest and greatest innovations. But again, it seems to me that these foreign-designed, Chinese-branded cars that the central government is now forcing the JVs to sell will fill the perceived quality gap between Chinese- and foreign-branded cars.

China's central government fully intends that its largest state-owned automakers will be global contenders, and they are patiently finding ways to make that happen. The WTO will not stand in the way. Wherever there's a rule, there's a way around it.

Sunday, March 20, 2011

Doc Iain – Retroracing Project & Funding Campaign

Doc Iain Corness, medical doctor, car racer, book author and journalist extraordinaire has started a 'retro race' project based on a FORD ESCORT pictured below and needs sponsorships to bring the car in a competitive position.

To support this project, a 'foundation' will be set up to accept cash sponsorhips to finance racing wheels, a high performance brake system and other upgrades. For those of you not familiar with Doc Iain, please download his bio here.

Please watch this space for more information and a link to a 'sponsorship web site' and more information.

Saturday, March 19, 2011

REUTERS AFRICA: Thai parts makers run as normal, look for new suppliers

Thai electronics and auto part makers are looking for alternative sources of raw materials to minimise the impact of likely supply chain disruptions after last week's earthquake in Japan, but they are operating as normal for now.

Automotive and technology industries around the globe have been spooked by fears that supplies of key components such as semiconductors and car parts will be disrupted by the closure of Japanese plants and power shortages.

Check out the full article here.

THE NATION: Thai carmakers face higher cost

Carmakers in Thailand are likely to face increasing costs in the short term if Japanese auto parts and specialised steel manufacturers cannot export their products following the tsunami disaster.

This would force Thai companies to import from other sources, which could cost them more.
Suparat Sirisuwannangkura, head of the Automotive Industry Club under the Federation of Thai Industries (FTI), yesterday said carmakers and auto-parts suppliers operating in Thailand normally had inventories to last one to two weeks.

Click here for full article.

Friday, March 18, 2011

Water scarcity looming for eastern areas

Changing weather patterns and a substantial rise in water consumption pose higher shortage risks for Thailand's Eastern Seaboard this year and next, says Eastern Water Resources Development and Management Plc.

Water consumption in Rayong, Chon Buri and Chachoengsao is expected to grow 20% during 2011 and 2012 from 245 million cubic metres last year, which was up 8% from 2009.

Automakers prepare for parts delays

Automotive manufacturers are double-checking backup plans to prevent a possible production halt following Japan's earthquake.

Thailand's second Ecocar

Yup, this is the Brio, the second Ecocar to be launched here after the Nissan March. This market-ready Brio made its world debut at Siam Paragon yesterday and has an identical body to the prototype unveiled at the Motor Expo in December.

Wednesday, March 16, 2011

AAPICO's Yeap Swee Chuan – Automotive superstar

AAPICO Hitech Plc president Yeap Swee Chuan embodies the spirit of the "rags to respectability" theme championed by 19th-century author Horatio Alger.
Once upon a time Yeap's business failed and he owed his creditors 200 million baht - today the man expects to sell an astronomical sum of over 12 billion baht worth of auto parts to Thailand's automotive industry.
Yeap Swee Chuan

Heightened risks prompt SOMBOON ADVANCE TECHNOLOGY Parts revenue review

Somboon Advance Technology Plc (SAT) will review this year's revenue forecast of 7.3 billion baht to take into account the Japanese disasters and Middle East riots.

SAT is the second-largest auto-parts maker on the Stock Exchange of Thailand (SET).

President Verayut Kitaphanich said it remained too early to determine the full effects from Japan's earthquake and tsunami last Friday and nuclear power plant failures this week. However, some impact has already been felt.

Monday, March 14, 2011

Japan Desaster may impact Thai Car Industry

Thailand's cabinet approved a 3.42 billion baht ($113 million) budget on Monday to develop the country's car industry, aiming in particular to develop a skilled workforce vital for the sector to build on its success.

Last week's deadly Japanese earthquake could pose a risk in the short term, although analysts and officials are still trying to gauge the impact on the supply chain and production lines. Some of Japan's largest manufacturers -- including Toyota Motor, Honda and Nissan -- have shut down facilities in northern Japan. "Plants in Thailand may need to adjust capacity to produce parts for automobiles for Japan as some plants that supply car parts may have been affected by the quake," said Suparat Sirisuwanangura, who heads the FTI's Automotive Industry Club. Finance Minister Korn Chatikavanij said the quake would have a short-term impact on the Thai car industry as some parts for Japanese-owned factories in Thailand were imported from Japan. 

Japan Earthquake Hobbles Car Makers

WALL STREET JOURNAL: As car makers continue assessing damage following the earthquake and tsunami that devastated certain coastal regions of Japan, it is becoming clear that disruption of the Japanese auto industry will be deeper and longer-lasting than initially thought.

Car plants take stock of damage

BUSINESS DAY: AUSTRALIA'S car industry is bracing itself following the Japanese earthquake and tsunami. Japanese car makers have shut plants across the country, leading to concerns about local supply.

Nissan loses at least 2,300 vehicles in earthquake, tsunami

MOTORWAY AMERICA: At least 2,300 Nissan and Infiniti brand vehicles awaiting shipment to U.S. and Japan showrooms were damaged in the earthquake and resulting tsunami, Automotive News reported today.

The cars — including nearly 1,300 Infiniti M, EX and FX models bound for North America — were parked at two coastal loading points when the giant waves swept through.

Sunday, March 13, 2011

AFG goes blogging

 By Dr Iain Corness 

The Automotive Focus Group (AFG), the fastest growing common interest group on the Eastern Seaboard, held another of its monthly meetings, this time at the Amari Orchid Resort in Pattaya.
Each month there is a speaker covering different subjects, but all focused around the automotive scene.  This time it was Uli Kaiser, a self confessed Internet and IT freak who spoke to the group on the AFG Blog and how to access it, and how to  contribute to it.
Uli presented some amazing statistics, showing that information and its dissemination were increasing exponentially with technical knowledge now doubling every two years.  This he referred to as [Shift Happens]. 

Very shortly, if not now, at least by the time I have finished typing this, China will have the largest number of English speaking people in the world.  There were also more than 30 billion internet searches on Google - this month!  The five most needed jobs in 2008 were not even thought of in 1998, and we are now trying to train young people for positions that are not even known.
The second half of Uli's presentation was to bring to the attention of the AFG members a proposed statistics project to be run with KPMG.  The survey would be on items pertaining to the auto motive industry in Thailand, and the statistics would be collated by KPMG, from information supplied by the AFG members.  At this stage, it is still a discussion topic, as many hurdles would have to be cleared, such as confidentiality agreements, which are common in the industry, and how the information could be given without breaking those agreements.
The AFG website can be accessed at, and the secretariat through Maurice Bromley at

Saturday, March 12, 2011

MCOT: Thailand's vehicle sales continue surging in February

BANGKOK, March 10  – The domestic sale of motor vehicles in Thailand surged by 44.2 per cent to 78,039 units in February, with Toyota retaining its predominant market share of 30,592 units, up 44.2 per cent, and Isuzu, ranked second largest with 14,713 units, up 22.2 per cent, an informed source in the automotive industry revealed on Wednesday.

How fragmented is China's auto industry?

For anyone wondering where I've been for the past several months, I've been right here at my desk. But instead of posting to this blog, I've been in a push to complete a full first draft of my dissertation by the end of March -- which is beginning to look like a real possibility.

For now, here's a quick post of some numbers I've been looking at for the past few days on market shares in China's auto industry.

Probably the most consistent component of China's auto policy since the mid-80s has been the insistence of the central government on consolidation in the industry. Just looking at the raw numbers, I think most people would agree that this demand has been completely justified.

In 1978, the year that Deng Xiaoping launched the first experimental market reforms in China, there were 55 auto assemblers. The number peaked at 124 in the mid-90s, and by 2008 (the latest numbers available) there were still 117 -- clearly, way too many.

But just how fragmented is China's auto industry? Here is a quick comparison with the US.

This chart compares cumulative 2010 market shares for the top five auto companies in the US and China.

If China were to take the US as its example, then it would seem to have already achieved a fair amount of consolidation. China’s largest auto group has a slightly larger share of its market than does the largest automaker in the U.S., and the top five in both markets are practically even.

Of course, we already know that the US market is somewhat less concentrated than it used to be. In 1980, for example, the Detroit Three held 76 percent of the US market. But I think few people would argue that less concentration in the US market has not been good for consumers.

So while it would appear that China is starting to see some solid growth out of the players at the top of its auto industry, the problem lies with all of those tiny companies at the bottom that, for some reason, refuse to go away.

Who are these small players? Quite a few are small, locally-owned automakers that lack any kind of scale to be profitable. In any given year, they probably break even on a cash flow basis, which means that the local government is absorbing their cost of capital. If exposed to true market competition, these small firms would quickly disappear.

So why haven't they? Local governments don't want them to. They employ anywhere from a few dozen to maybe even a few hundred local people, and local governments are not inclined to create any more of an unemployment problem than they have to.

Of course, the central government, through the NDRC or MIIT, could force these local enterprises to close, but why would they? The central government is no more interested in putting people out of work than are the local governments.

So if we simply accept that some of these small players are part of a welfare system that keeps people gainfully employed, then China's leaders should at least be satisfied that, at the top of its auto industry, it appears to have the makings of an increasingly strong and competitive industry. Right?

I don't think so, and this next chart reveals why.

Here we have the top five companies in both the US and China along with their respective market shares.

What I notice about this chart is that each of the companies on the US side also corresponds with a brand, but each of the companies on the Chinese side is just a big old state-owned enterprise that assembles cars for foreign companies.

SAIC makes most of its money selling VW and GM cars. Dongfeng sells Nissan and Citroen. FAW sells Toyota and VW. Chang'an sells Ford, Mazda and Suzuki. BAIC sells Hyundai and Mercedes.

Yes, each of these companies also sells some cars under its own brand, but the numbers are comparatively small. Overall, only 30.9 percent of sedans sold in China in 2010 were of local brands -- up only slightly from 30 percent in 2009.

And therein lies the problem. China's central government wants its biggest SOEs to get bigger so that they can compete with the foreign multinationals. For now, they would just like to dominate in their own market, but eventually, they want to compete in overseas markets as well.

The problem is that, while these SOEs are indeed developing their own brands, it's just so easy to sit back and rake in profits while the foreigners contribute all of the intellectual property.

Designing your own stuff is hard.

Mazda sets new record in February

THE NATION: Auto-maker whips up hype about Mazda3

Ford sales surge in Thailand

THE NATION: American auto-maker Ford is enjoying extremely high growth in Thailand thanks to the strong sales performance of the Fiesta subcompact and Ranger pickup.

Monday, March 7, 2011


19-22 May 2011…alongside SUBCON.

Subcon Thailand 2011 co-located with INTERMACH 2011

Check out this SUBCON video….. Thailand will become the manufacturing hub for the ASEAN region….

Sunday, March 6, 2011

BMW X1 sDrive to cost Bt2.14 million

BMW X1 sDrive to cost Bt2.14 million
German auto-maker BMW has announced the official pricing of its X1 subcompact crossover.

Saturday, March 5, 2011

What about a revolution in oil dependency?

HAARETZ (interesting read): As the countries owning most of the planet's oil reserves confront growing political turmoil, the economic stability of the whole world will remain at risk - until an alternative to petroleum is developed.

Friday, March 4, 2011

Shocking: Indian steel manager is 'burned alive' by fired employees after signing their dismissal letters

DAILY MAIL: A senior executive at a steel factory in Eastern India has been burned alive by workers who were protesting at losing their jobs.
R.S Roy, a deputy general manager at the Graphite India Limited's steel unit in Orissa state, was set upon after he signed dismissal letters for about a dozen workers at the factory, according to local police.

Miss Motorshow on Facebook...

Exciting contest – who is the fairest of them all….

Itsy bitsy spider causes Mazda recall

CBS NEWS: The itsy bitsy spider crawled up the Mazda vent.

Mazda recalled some cars because of where the spider went.

In what may well be an automotive industry first, Mazda is recalling 52,000 cars because of the potential for a vent line to be clogged by -- you guessed it -- spider webs. (Yes, really.)

Thursday, March 3, 2011

Mazda3 local assembly starts in Thailand, Malaysia

ABR: Mazda Motor, Mazda Sales (Thailand) (MST) and its distributor in Malaysia, Bermaz Motor, has started the assembly of its second-generation Mazda3 (known in Japan as the Mazda Axela) in Thailand and Malaysia.

Indonesia: Thailand becomes a top supplier

JAKARTA POST: A minister says that Thailand — Southeast Asia’s second largest economy — is now one of Indonesia’s major suppliers due to a significant increase in local imports of Thai cars and car components.

Trade Minister Mari Elka Pangestu said on Wednesday that Thailand replaced South Korea as Indonesia’s fifth largest source of imports in January.
“This is interesting. Thailand is getting more important for us. It is likely related to our automotive industry,” she said during a press conference in Jakarta.

When the dragon ceases to roar

BANGKOK POST: Chinese economic growth of 9.1% in 2009 was a source of optimism for a world mired in the biggest financial crisis since the Great Depression. This alone was enough for emerging markets to start growing again, with China leading the pack. And the rest is history.

Wednesday, March 2, 2011

Thailand Is Mostly An Untapped Market: Toyota Jumps In

Toyota Motor Corporation (NYSE:TM) Thailand senior vice-president Wichien Emprasertsuk said “Any tax hikes on pickup trucks and its variants were against the objective of forming an international innovative multi-purpose vehicle (IMV) program, in which Toyota Motor Corporation (NYSE:TM) invested 30 million baht in Thailand to design and produce the IMV products.”

New car tax structure completed

The Excise Department has completed the new car tax structure, ready to have it implemented soon.