Everything is OK: Industrial Output Cut by 50 %

Local output down almost 50 per cent


By The Nation
Published on March 31, 2009

Local manufacturers have gradually reduced production, which dropped almost 50 per cent in the first two months before exports began collapsing last year.

The Industrial Economics Office yesterday said the Kingdom's Manufacturing Index contracted 23.07 per cent last month on top of 25.6 per cent in January. As a result, capacity use among manufacturers had now been cut almost in half on average.

The global financial crisis has directly affected both exports and manufacturing. Domestic consumption has also fallen, due to the effects of the global crisis.

The auto industry is one of the hardest hit by the economic crisis.

Its production contracted 50.64 per cent last month, against 35.59 per cent in January.

Director-general Arthit Wuthikaro said the drop in auto manufacturing resulted mainly from two reasons: falling car exports and domestic sales; and local consumers waiting to learn the government's policy on reducing excise tax. As a result, auto production dropped to 41.75 per cent of capacity last month.

The decline in auto manufacturing has directly hit small and medium-sized parts manufacturers, due to reduced orders.

In addition, manufacturing in the electric and electronics industry, particularly air-conditioners, dropped 57.62 per cent, against 39.33 per cent in January. However, hard-disk drives and electronics production were on the upswing, growing more last month than in January.

Arthit said manufacturing had contracted for five consecutive months and that this was expected to continue until the third quarter.

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The Industrial Economics Office yesterday said the Kingdom's Manufacturing Index contracted 23.07 per cent last month on top of 25.6 per cent in January. As a result, capacity use among manufacturers had now been cut almost in half on average.

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And Thailand thinks.............

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BOT : Thai economy resilient


“All countries have encountered the world crisis, but we have good things to help boost the economy,” senior director Amara Sriphayak said after meeting with an IMF delegation on its annual visit.

The Nation

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Prime Minister Abhisit

“I am not going to boast by committing how much the economy will grow, but I can assure you that the government is committing to to spur economy and to lift the quality of life of all the Thais.

Bangkok Post

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Originally Posted by gjbkk

we have good things to help boost the economy

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Good things, eh. Phew.

Interesting on the car side of things. As new car sales have plumetted in UK, it has created a shortae of nearly new, trade in used cars, so prices of used cars are going up.
As i am selling my used Honda before i move to LOS, i spoke to the local Honda main dealer. He said second hand sales were down, but he put half a dozen cars from his forecourt in at auction and got better than the screen price for every one.

Our packaging business is booming with a lack of capacity being one of our main problems at this time.

The main problem is a shortage of plastic raw material.

The plastic resin processors closed down most of their refinery subject to a rise in crude oil leading to a drastic shortage which I believe is a criminal act.

Nothing more than holding their long standing and devoted customer's to ransom in my opinion and they should be fined by the governing body here in LOS.

With regard to the fall in exports this phenomenom has been present long before the global economic problems hit these shores.

We can thank the Bank of Thailand and for their macabre support of the Thai Currency. :rolleyes:

The bubble is about to burst.

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Originally Posted by Loy Toy

With regard to the fall in exports this phenomenom has been present long before the global economic problems hit these shores.

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Thai exprts peaked at an all time high in August 2008 and started to fall after that and gradually and in September, October, November they nosedived in line with the rest of region.
Which period are you thinking of?

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Originally Posted by Loy Toy

The plastic resin processors closed down most of their refinery

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Can you not avoid that kind of Thai fcukery by importing your own? Being held to ransome by basic material suppliers at this time seems ridiculous.

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Originally Posted by EmperorTud

The bubble is about to burst.

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I think it burst in November, the numbers in the OP just underline that.

Its an interesting time for the Thai auto industry, if the US companies get bailed out and Obama turns the protectionist screw then imports to the US could diminish. Given that it will be a good couple of years before US demand gets back up to speed that could be a death knell for factories here.

The party is over for Thailand, for at least a few years and possibly beyond, all this has implications to make '97 seem insignificant in comparison to what might happen here IMHO.

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Originally Posted by EmperorTud

The bubble is about to burst.

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I'm still waiting for the THB to crash, a bit at least. When you think it will happen?

What currency should i exchange my THB to now, if i want to make a buck when it goes? Euro hasn't weakened that much since this recession started.

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Originally Posted by EmperorTud

The bubble is about to burst.

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Bring back 1997, what a great time for us with Money in an overseas bank, You could pick up almost new imported cars at half of UK prices, and the Baht was worth fvckall. the streets were empty, partic upcountry.
I remember well driving between Korat and KK in my newly acquired Esprit turbo and barely seeing another car on the road.
A few petrol resellers around the country tried the old pussy sells, strategy to lift sales so they employed a few scantily clad local pretties to entice the punters in.
The combination of hard economic times and an exotic car meant thees girls had their knickers unfastened before they could get my filler cap off.
A meaner man would have taken full advantage of their misfortune.

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Originally Posted by Loy Toy

Our packaging business is booming with a lack of capacity being one of our main problems at this time.

The main problem is a shortage of plastic raw material.

The plastic resin processors closed down most of their refinery subject to a rise in crude oil leading to a drastic shortage which I believe is a criminal act.

Nothing more than holding their long standing and devoted customer's to ransom in my opinion and they should be fined by the governing body here in LOS.

With regard to the fall in exports this phenomenom has been present long before the global economic problems hit these shores.

We can thank the Bank of Thailand and for their macabre support of the Thai Currency. :rolleyes:

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Plastic production, especially HDPE and PVC pellets is the downstream production process of upstream oil refining; aromatics; and olefins production. All of which are only operating at 50% or less in the industrial areas of Thailand.
A lot of these plants are without any orders at all to fulfill, so they are shutting down for major overhauls and some indefinitely, with no start-up date yet proposed.
I don't know if its a criminal act to shut down the process plants, but it certainly seems one to keep propping up the Baht to fukc exporters and the core business of this country until the inevitable happens at great cost to this country and its workers..

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Originally Posted by EmperorTud

The bubble is about to burst.

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In more way than one

I am not sure about the bubble bursting per se.
back in 97 the economy contracted 10.5%
current contraction is only 3.5 so we have a bit to go

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Originally Posted by Dan

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Originally Posted by gjbkk

we have good things to help boost the economy

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Good things, eh. Phew.

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It's frightening when the TeakDoor economic discussions are more professional than senior Thai directors

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Originally Posted by Spin

Thai exprts peaked at an all time high in August 2008 and started to fall after that and gradually and in September, October, November they nosedived in line with the rest of region.

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I made the initial mistake (again) about not reading government figures mate.

Being a manufacturer here leads me to take to heart what is actually happening on the shop floor and what is being discussed in the boardrooms.

All I know that the major commodity product manufacturing companies that I deal with have been lamenting about the strength of the baht for well over a year now. They have been gradually losing orders to our regional neighbours and generally because their prices are no longer competitive.

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Originally Posted by Spin

Can you not avoid that kind of Thai fcukery by importing your own? Being held to ransome by basic material suppliers at this time seems ridiculous.

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We have had to order material from Singapore (2,000 ton lots) and to fill our raw material gap and the duties are horrendous. Our company also is trying to work by the "JIT" programe but find it impossible to function anywhere near efficiency and with regard to raw material in>>>>>>>>finished product out.

well with production shutting down, we might see some prices going up, and a few more profitable businesses when competitors are shutting doors, until the growth cycle begins again

Wife's friend bought a new Chevy Colorado 2-door this weekend.
She claims the prices have never been so low and they only had to put down 10K for it. Financed it over six years [at] ~8,500 a month. :mid:

There is no way they will still have that truck a year from now.

House prices in the US are down for 19% from Jan 2008

It makes you want to leave the telly off.

cheers

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Originally Posted by Loy Toy

the duties are horrendous

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Import duties often vary with the ability of the import agent to get the best number. Some seem better connected than others. A colleague just imported a waterjet machine from China and his agent got him 1% duty when others quoted the best they could get was 9%. Quite a whack on a 4 million baht purchase. No doubt that process is corrupt to the max.

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Originally Posted by Dan

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Originally Posted by gjbkk

we have good things to help boost the economy

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Good things, eh. Phew.

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Tis that bloody cocktail again. When you want your next visa, you have to provide receipts for at least 5,000 glasses drunk.

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Originally Posted by panama hat

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Originally Posted by Dan

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Originally Posted by gjbkk

we have good things to help boost the economy

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Good things, eh. Phew.

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It's frightening when the TeakDoor economic discussions are more professional than senior Thai directors

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Frankly Hatters, wouldn't matter where such economic expertise and punditry is derived. As you might know already, this model of study is almost always based upon convention and establishement illusions. "Tis wonder that anyone of us could easily analyze these seemingly complex issues better than than experts. Subjective and biased politics should not mingle with straight-up social science.

Time to regain our agrarian substantive existence.

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Originally Posted by Rural Surin

Time to regain our agrarian substantive existence.

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Our? Our? where the buggery does "our" come from??

You Thai RS?

.....

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More than 300 Fisher and Paykel refrigerator factory workers in Brisbane lose jobs


MORE than 300 workers will finish up at Brisbane's Fisher and Paykel refrigerator factory tomorrow, as the company prepares to shift operations to Thailand.
The Australian Manufacturing Workers Union (AMWU) says the workers aren't highly paid and the decision is disappointing especially given the amount of support the company's been given.

"We've worked hard with Fisher and Paykel in the past to help them ensure profitability out of their Queensland operation," AMWU Secretary Andrew Dettmer said.

"Fisher and Paykel has also received considerable assistance from both state and federal governments to ensure viability, but it looks like that was all in vain.

"It makes you wonder what it takes now to encourage these companies to keep their manufacturing operations in Australia," he said.

Despite the layoffs, Mr Dettmer said the manufacturing industry in Queensland was actually growing, with 4000 jobs created last year.

"It's just a shame that companies like Fisher and Paykel, which have built up a reputation based on being high-quality and locally manufactured, can't see the value in retaining their local workforces."

Fisher and Paykel will also close factories in the US and New Zealand, where it makes ovens and dishwashers.

Its manufacturing will move to Thailand and Mexico.




More that 300 Fisher and Paykel refrigerator factory workers in Brisbane lose jobs | The Australian

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Originally Posted by Texpat

Wife's friend bought a new Chevy Colorado 2-door this weekend.
She claims the prices have never been so low and they only had to put down 10K for it. Financed it over six years [at] ~8,500 a month. :mid:

There is no way they will still have that truck a year from now.

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My neighbours are both teachers - one is permanent, one is on contract. They've each spunked about 1.2 million on new cars in the last 6 months. Both have PhDs yet neither seems to have the faintest clue what's going on. I suggested waiting a few months and then picking up a second-hand one as they're sure to be sold by the bucket-load but they can't do that - it won't have red plates.

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Originally Posted by Spin

Import duties often vary with the ability of the import agent to get the best number. Some seem better connected than others. A colleague just imported a waterjet machine from China and his agent got him 1% duty when others quoted the best they could get was 9%. Quite a whack on a 4 million baht purchase. No doubt that process is corrupt to the max.

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You have hit the nail on the head Spin and I can remember skirting a 40% import duty and finalizing 3% on a USD60k machine.

The problem for us here in LOS is when the local suppliers buy all the by-products from crude oil and to make plastic resin at the lowest possible price, stock pile it and then wait for the crude oil prices to go back up and then start manufacturing and supplying.

The import fees on plastic resin (particular grades) are also quite high because of protectionist policy.

Public debt could reach 45 pct of GDP

By: BangkokPost.com
Published: 2/04/2009 at 12:00 PM


The country's public debt could be between 43 and 45 per cent of the gross domestic product (GDP), according to Public Debt Management Office director-general Pongpanu Svetarundra.

However, it could be as high as 46 per cent if the 2009 GDP is lower than the Finance Ministry's forecast at 2.5 per cent, he said on Thursday.

The public debt projection already covered the government's economic stimulus projects worth over 1.56 trillion baht, he said.

However, he believed the public debt/GDP ratio would not reach 60 per cent as many predicted.

The director-general also believed the government's plan to borrow 94 billion baht from local financial institutions would not be adequate to stimulate the economy, but insisted his agency would manage the debt of the country properly while avoiding too much financial risks.

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would not reach 60 per cent as many predicted

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wishful thinking again?

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his agency would manage the debt of the country properly while avoiding too much financial risks.

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:mid:

Live in hope and keep smiling

Very bad news