The very active Automotive Focus Group (AFG) held its latest meeting at the Hilton Hotel on Beach Road recently. With the topic encompassing the Automotive Industry in Southeast Asia, this was a very hot theme and the meeting was very well attended with over 50 members present.
The presentation commenced with guest speaker Colin Kinghorn, the Chief Operating Officer of Ipsos Business Consulting and acting Regional Head for South East Asia and Australia, discussing the challenges, threats and opportunities in the Indonesian automotive market, plus providing some fresh insights on the rapidly emerging aftermarket in Thailand.
Colin Kinghorn.
The presentation showed the depth of experience of Colin’s team that works with a wide variety of clients in the automotive industry – auto OEMs, Construction OEMs, vehicle parts manufacturers as well as related industries such as lubricants, paint and coatings and finance.
Colin presented scenarios encompassing future trends, which, as he mentioned, could be looked at optimistically or with pessimism.
Dealing first with Indonesia, he drew attention to the fact that whilst the US automakers are pulling out (GM and Ford) there are 21 million new consumers coming up in Indonesia. Can the auto industry let the opportunities go?
He pointed out that currently the Japanese automakers have the Indonesian market sewn up, and with local content due to go up from 40 percent to 80 percent in five years it will be necessary to have a facility on the ground. However, Foreign Direct Investment is flat.
Sales are predicted to rise by around 7-8 percent, both commuter and luxury, but how to break the Japanese stranglehold?
Dealing with the local Thailand situation, the NE region will become increasingly important and passenger car sales should increase by around 5 percent, but there is a serious problem with domestic debt, being the highest in Asia, leading to a serious problem with default rate on loans increasing.
Despite those negatives, branded service centers will gain at the expense of the small local repair shops.
Thailand worries about its position in the marketplace in ASEAN, but the Ipsos figures would lead one to believe that whilst Indonesia may begin to catch up, Thailand will still be the hub of the auto industry in 2020.
To find out more about Ipsos – www.ipsosconsulting.com
Contact with the AFG can be made through its President f[email protected].
