Suzuki Closed its Factories in Thailand and Imported them from Indonesia and Japan

On June 7, Suzuki announced it would cease production of cars and trucks in Thailand by the end of next year to concentrate on manufacturing electric and hybrid vehicles elsewhere. The reason cited is the slump in sales in Thailand, and Suzuki has decided to focus on more promising global production bases. As for the local automobile market in Thailand, Suzuki plans to maintain it through imports from other production bases. Suzuki said it plans to import electric vehicles and hybrid vehicles from other factories in ASEAN, Japan, and India, continuing to carry out sales and after-sales service in Thailand.

Thailand Suzuki Motor Co., Ltd. (SMT) was established in 2011 and began producing energy-saving compact cars in 2012. The company, producing 60,000 cars per year, and with about 800 employees, responsible for producing and exporting cars to overseas markets in the local Thai market. But recent production has been just normal, with only 7,500 vehicles being produced in the Thai factory during the previous fiscal year ending in March of this year.

Not only has Suzuki's factory production dropped, but car production in other factories in Thailand is also declining, and many factories facing the risk of closure. According to the Federation of Thai Industries (FTI), due to the economic slowdown, merger plans, or rising operational costs, there have already been 1,600 to 1,700 factory closures in Thailand earlier this year, with the number of closed factories expected to steadily increase. Suzuki is not the only auto brand to stop producing cars in Thailand. In May of this year, Subaru announced plans to end car production in Thailand in December, but it will continue to sell cars in Thailand. However, starting next year, these cars will be exported from Japan to Thailand.

With the primary selection factors being relatively low labor costs and geographical advantages, the Southeast Asia region is a crucial battleground for Asian car manufacturers. Kriengkrai Thiennukul, Chairman of the FTI in Thailand, stated that the Thai auto industry is in trouble compared to Malaysia due to recent domestic downturn and export slowdown in Thailand. Thailand can no longer be known as the Detroit of Asia, as Malaysia is overtaking Thailand, and Malaysia has surpassed Thailand to become the second-largest car market in Southeast Asia, only after Indonesia. Suzuki will continue to sell electric and hybrid cars in Thailand through SMT, and Suzuki hopes to focus its production in Asia in Indonesia, Japan, and India.