Bloomberg News

Thai Automakers Reduce 2011 Output Forecast by 17% on Floods

November 17, 2011

Nov. 17 (Bloomberg) -- Thai automakers cut a forecast for car production this year by 17 percent after floods swamped factories and disrupted supply chains.

Vehicle output may drop to 1.5 million units this year, compared with an earlier estimate of 1.8 million. Surapong Paisitpatnapong, a spokesman for the Thai Automotive Industry Club, said at a briefing in Bangkok. Surapong last month predicted output will fall to 1.65 million units.

Advancing waters have swamped seven industrial estates north of Bangkok with 891 factories, and threaten two others east of the capital where Honda Motor Co. and Isuzu Motors Ltd. have operations. Companies including Toyota Motor Corp. scrapped profit forecasts after the floods disrupted supply chains.

“Car plants are now running at only 50 percent of capacity on average, and daily production has fallen to about 3,000 units from 6,000,” Surapong said. “We still don’t know when they can resume full operations. We have to wait until the factories dry out.”

The floods will affect overall manufacturing until early 2012, and plants will probably resume normal operations in the second quarter, Songtham Pinto, director of the central bank’s office of macroeconomics, said today.

Auto production fell 68 percent to 49,439 units in October, the lowest level in more than nine years, according to the automotive trade group, which is part of the Federation of Thai Industries. Car sales dropped 41 percent to 42,873 units in line with lower output, it said.

--Editor: Tony Jordan

To contact the reporters on this story: Suttinee Yuvejwattana in Bangkok at suttinee1@bloomberg.net

To contact the editor responsible for this story: Tony Jordan at tjordan3@bloomberg.net


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