Regional automotive testing centre mooted for Thailand

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Regional automotive testing centre mooted for Thailand

We can expect to hear a lot of ‘noise’ over the next 12 months or so from government and business with the acronym AEC (ASEAN Economic Community) as the key feature. While the public relations and marketing spin machines have long focussed on the word ‘hub’, you can now expect that to be allied to AEC when it comes to referring to almost any new plans or initiatives where Thailand can see an opportunity to lead the region.

So, it was no surprise to see the words ‘hub’ and ‘AEC’ linked following a meeting between the newly-appointed president of the Thai Automotive Industry Association (TAIA) and the Minister for Industry in the first week of November.

The TAIA president urged the government to forge ahead with a long-delayed plan to finally establish an automotive testing centre to strengthen Thailand’s position as a regional automotive hub, especially with the AEC just a year away.

The president was quoted as saying that a, “testing centre is vital to upgrade Thailand to become an ASEAN production hub for innovative vehicles.”

As he noted, Thailand is the de facto major car producer of ASEAN with a maximum output of 2.85 million units per annum.

The AEC is aiming to increase standards across 19 automotive categories and, at present, the testing centre located in Samut Prakan and run by the Thai Automotive Institute is only competent across eight of those categories.

The local automotive industry has been seeking financial support for just over two years from the Strategic Committee for Reconstruction and Future Development (SCRF) for its plan to set up a facility to serve the regional industry. The problem is the cost, an estimated eight billion baht.

Vehicles tested at a centre of this standard would not then be required to be tested in other countries. At the moment, Thai vehicle assemblers have to ship their products to be tested in India, Taiwan, or even Spain when a new vehicle series is launched.

The Thai Automotive Institute has proposed three locations for a new centre: Amata City, Gateway City, and Hemaraj Industrial estates, all in the east as these are closest to automotive assembly plants. The centre in Samut Prakan should also be upgraded.

One of the sticking points for the building of the testing centre has been the SCRF arguing that car manufacturers should share in the cost of its establishment. The SCRF also tasked the Thai Automotive Institute with studying the feasibility of obtaining partial funding from car companies.

The Industry Minister says the government is committed to an investment in the centre but the plan should be divided into two phases with a reduced budget to help drive the project into the next stage.