Mitsubishi Increases Manufacturing Stake in Thailand

Mitsubishi is accelerating its expansion plans in Thailand and will increase its production capacity to 500,000 units in 2013, two years ahead of schedule.

In the process, Thailand will replace Japan as Mitsubishi's largest vehicle-production base.

The Nation newspaper quotes Mitsubishi Thailand President Nobuyuki Murahashi as saying the auto maker had planned to increase capacity to 500,000 vehicles in 2015 from 350,000 units this year, but instead will raise it to 400,000 this year and 500,000 in 2013.

Murahashi says although Europe still faces an economic crisis, demand for imported cars in Asia continues to grow, and Mitsubishi is shifting its export focus from Europe to the Asian market.

The auto maker has raised its Thai sales forecast for this year from 120,000 units to 126,000.

The Bangkok Post reports Mitsubishi will spend TB4 billion to TB5 billion ($130 million to $163 million) to upgrade its three Thai assembly plants to allow for increased output of existing models and preparations for new ones.

Murahashi says TB1 billion ($32.5 million) will be spent to hike production capacity at its third plant at Laem Chabang. The factory, which builds Mirage eco-cars for the domestic and international markets, began operations early this year with annual capacity of 150,000 units. This eventually will be boosted to 200,000.

Another TB3 billion to TB4 billion ($98 million to $130 million) will be spent at the first and second Laem Chabang plants to prepare for production of new models. The two facilities’ total annual capacity is 310,000 vehicles.

Murahashi says once the Thai expansion is completed, Mitsubishi plants in Japan will produce only vehicles to serve the domestic market and as a research and development base.