Second plant to boost Nissan Thailand production 40

Second plant to boost Nissan Thailand production 40%.

Southeast Asia Auto Industry Enjoying Production Boom

Driving demand are the relatively strong economies of Thailand, Indonesia and Malaysia, with each country’s gross domestic product up more than 5%.

TOKYO – Southeast Asia’s three biggest auto-producing countries, Thailand, Indonesia and Malaysia, all will report record or near-record production in 2012.

In Thailand, output jumped 32% to 1.7 million units through Sept. 30, surpassing the previous year’s high in just nine months and on track to exceed 2.2 million for the full year.

Thai auto makers, mostly Japanese transplants, produced 1.5 million vehicles in 2011, down from 1.6 million prior-year due to the effects of the earthquake and tsunami in Japan and flooding in Thailand on the supply chains in both countries.

The same story can be seen in Indonesia, where production of 788,342 units through September was primed to pass the current record of 837,948, while Malaysia, with 425,192 through the first nine months, will roughly match its 2011 total of 567,715 if output continues at its current pace.

Driving demand is a relatively strong economy throughout the region, with gross domestic product up more than 5% in all three countries. Added to that, Japanese auto makers, in particular Nissan, Mitsubishi and Toyota, are shifting production of smaller models to the region to minimize the effects of the strong yen.

Analysts are bullish about the regional industry’s medium- and long-term growth prospects, as well. J.P. Morgan Japan is forecasting that Indonesian production will grow to 1.5 million units in 2015, up from a projected 1 million this year, then to 2 million in 2020.

Nissan announced in early November it would build a second Thai plant with capacity to make 150,000 vehicles annually when it comes onstream in August 2014. The factory, to be located next to the existing facility in Samut Prakan province, will boost the auto maker’s production capacity in the country to 370,000 units.

Toyota said Nov. 10 it plans to construct a new engine plant in Karawang regency, Indonesia, and increase output at its No.1 Karawang assembly plant that currently produces up to 110,000 Innovative Multipurpose Vehicles. The auto maker plans to raise capacity to 130,000 units by September 2013.

Toyota’s Daihatsu small-car subsidiary opened a second Karawang factory in October, and Toyota Auto Body begins production in December at PT Sugity Creatives PT, its vehicle- and parts-making joint venture with Toyota Motor Mfg. Indonesia and Toyota Tsusho.

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