Industries & Track Record
The Industry. An overview, worldwide and in the ASEAN region
AdvisingAsia advises both car manufacturers and suppliers worldwide, especially in order to establish their production sites in the ASEAN area or to develop a sales network in the same region. For example, AdvisingAsia supports manufacturers and suppliers to develop their brand management, increase their potential with new business models and improve their products and operations.
Automotive is facing some of strongest challenges of its history. Indeed, from the ground level, three powerful forces are roiling the auto industry: shifts in consumer demand, expanded regulatory requirements for safety and fuel economy, and the increased availability of data and information.
Consumers appear to lose passion with dream sport cars and are likely to buy cars as they were commodities, i.e. only a mean of transportation. Accordingly, this change in consumer demand is affecting how much people are willing to pay for automobiles.
Moreover, as the CEO of Fiat Chrysler, Mr Sergio Marchionne, recently pointed out, top OEMs (original equipment manufacturers) spent over €100bn for product development in 2014 only, i.e. more than €2bn/week in product development and tooling costs, and poised to invest at similar rates in the futures. However, historical returns have been broadly below cost of capital, even after the restructuring of the US auto industry and NAFTA volumes at peak.
By taking into accont all the mentioned costs, it has become essential for automobile manufacturers to reduce their captial expenditures.
Thailand has some strong scopes for selling or manufacturing automobiles/industrial parts within its territory. Indeed, with 2.46 million vehicles manufactured in Thailand in 2013, the country was ranked 9th amongst automotive manufacturing countries in the world. In 2014, Thailand’s automotive industry was the largest export sector, with an export value of US$30 billion according to the Thailand Ministry of Commerce. Thai automotive benefits from a strategic location at the center of Southeast Asia, excellent infrastructure, an “industrial habitat”, and strong government support.
Within this unique environment, AdvisingAsia can offer two possibile solutions:
- Make its Client enter in new markets, hungry for more powerful, technologil and «status symbol» cars – think about the fact that Indonesia is likely to become one of fast-growing mass markets for the automotive industry;
- Establish a new manufacturing firm in highly developing countries, where the labour costs is lower but, as in the case of Thailand, labourers are skilled and some of the most trained in the worldwide automotive industry.
AdvisingAsia track record. How to establish a fully-operative industrial manufacturing firm within six months
The case : the Client is a medium size company operating in the field of Industrial painting for leading automotive firm.
The Client got in touch with AdvisingAsia in January 2015, explaining us its intention to study the feasibility of opening an industrial painting factory in the Kingdom of Thailand.
After preliminary discussion, we proposed to prepare a feasibility study with attached business plan analyzing the market, competitors behavior, marketing plan and financial plan.
Based on the plan, we advised the Client on the best option with regard to: company formation, best location of the production facility, government incentives, most favorable tax structure, government authorization and permit for operating a company, machinery and equipment importation from Italy, management and personnel recruitment and training.
We have also offered to be in charge with our own personnel for sales & marketing and promotion activities, in order to secure new customers in short time.
On 1st July 2015 the factory has started its production operation, just six moths after the first contact with the Client.
AdvisingAsia has been able to provide a “turn Key” factory within six months.
AdvisingAsia track record. How to establish a sales and distribution network in South-East Asia
The case: the Client is a medium size company operating in the field of automotive accessories and equipment
The Client had an established dealers network in some ASEAN countries (Thailand, Indonesia, Hong Kong, Vietnam and Malaysia), but was very difficult to manage it and especially grow the business from Europe.
AdvisingAsia has taken over the management of the sales & distribution network in all the mentioned countries.
From our headquarters in Bangkok, we are able to manage all dealers and distributor utilizing our own personnel, who is travelling ad visiting customers for our main client.
In these years we have been able to establish new dealers and distributors in various countries, improving the overall quality of the customers and enhancing sales
AdvisingAsia is working as commercial office in the South-East Asia region for its Client, with obvious benefits and cost savings.
For further information, please download the report over Thai automotive industry, provided by the Thailand Board of Investment. (Click here)