German automotive components manufacturer ZF Friedrichshafen AG plans to increase local procurement in Thailand to make the country a major global production hub, a Thai government official confirmed this week. The move comes after the US announced significant hikes in import tariffs for a number of major trading partners, including China, potentially sparking a major global trade war.
ZF currently has five production plants in Thailand, located in Rayong and Chonburi provinces, making a wide range of automotive components including transmission, chassis and safety systems. The company plans to strengthen its local supply chain and expand production in the country, as it looks to increase exports to global markets.
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Speaking at the ZF Thailand Supplier Day 2025 in Bangkok this week, the Thai Board of Investment’s (BOI) general secretary Narit Therdsatheerasak confirmed that the German company’s local subsidiary, ZF (Thailand) Company Ltd, plans to increase outsourcing from Thai-based companies tenfold over the next five years – from EUR50m to EUR500m.
The event was attended by representatives of more than 200 companies looking to benefit from ZF’s new procurement policies in the country. ZF is understood to have already selected 75 potential tier 2 and tier 3 suppliers with which it intends to begin negotiations and move its increased outsourcing plans forward. These cover eight major product categories including chassis solutions, electromechanical assemblies, steel parts, castings, forging and forming, chemicals, passive safety and also non-production materials.
ZF has also invited component manufacturers from other ASEAN countries, China and elsewhere to join the “business matching negotiations” and make new investments in the country.
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