Ford has asked the Bangkok and Manila governments for preferential Asean Industrial Cooperation (Aico) import duties to support production swaps between its Thailand and Philippine subsidiaries, the Philippines website INQ7.Net reported.

Ford plans to assemble the Escape sport utility vehicle and the Laser/Lynx/Mazda 323 sedan at its Sta. Rosa plant in the Philippines for export to Thailand and Indonesia, the website said.

In return, it added, the Thai subsidiary, Auto Alliance (owned 48 percent by Ford and 45 percent by Mazda) would ship Ranger pickup trucks and Volvo sedans to the Philippines.

Ford wants preferential duties to apply to this trade between its Thai and Philippines operations. Ideally, it would like rates of between 0 and 5 percent or, at least, a hefty discount on the prevailing duties of at least 30 percent applied to fully-assembled vehicles, INQ7.Net said.


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Ford


The website added that Ford has not revealed projected vehicle volumes or said if the latest proposal is connected to the Philippines subsidiary's application to the government to import 2,000 Escape SUVs munus tyres and batteries (common local content items) at preferential duty rates.

INQ7.Net said that Ford closed its Thailand and Philippine operations in 1976 and 1984 respectively but returned during the 1990s to invest $US500 million in Thailand and $150 million in the Philippines.

The 100,000-units-a-year Thai plant is the company's biggest pickup factory outside the United States and exports Mazda and Ford-badged trucks all over Asia, Australasia and even as far as the UK and Europe. (The Thai Ford Ranger is based on Mazda's B-series pickup; in the U.S. it's the other way around.)

In contrast, the Sta. Rosa plant in the Philippines has a capacity of 25,000 units a year, the website said.

It added that, with massive investment by Ford and GM (which has an Opel minivan plant widely rumoured to be about to build partner Fiat Group's cars for the region), Thailand is now widely seen as 'Asia's Detroit' and is Asia's third largest vehicle exporter behind Japan and South Korea.

Thailand is also the world's second largest market for pickup trucks next only to the United States, INQ7.Net said.

The Thai and Philippines governments must both agree on the Ford duty cut proposals and the website said that Ford is reportedly facing stiff resistance from Thai rivals.

However, INQ7.Net noted, the Philippines is seriously considering Ford's idea because it would allow a boost in vehicle exports to between 10,300 units and 19,800 units from 2002 to 2004.

The Philippines exported just 94 units in 2000 compared to Thailand's 141,436 units; Indonesia's 47,001 units; and Malaysia's 12,600 units, the website said.


To view related research reports, please follow the links below:-

Market Profile: Thailand

Automotive b2b - Strategic threats and opportunities in the automotive supply chain


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