GM, Ford Spar for Sales Crown in Thailand

BANGKOK – Thailand’s auto industry is seeing a shift as the two Detroit players here, Ford and General Motors, step up their game by using the country as an export springboard.

Their strategy is underpinned by a desire to ramp up their share of a booming domestic market, while also utilizing it as a product launching pad for the wider 10-country Association of Southeast Asia region.

In doing so, the U.S. auto makers are snapping at the heels of the established Japanese car companies that traditionally have carved up the market among themselves.

Ford and GM also are bringing to this part of Asia their long-standing rivalry as they eye new segments. It’s no accident that both introduced new midsize-pickup trucks in Thailand at the end of last year – the new Ranger and Colorado, respectively.

GM edged out Ford in 2011 as the top non-Japanese brand with sales of 31,595 vehicles, up 58% from prior-year, good for a 4% market share, Ford delivered 29,200 units, up 114.1% for a 3.7% share, according to Thai industry data compiled by Toyota.

GM’s boost came from the Chevrolet Colorado, which delivered close to 9,000 units last year to make it the best-selling non-Japanese pickup. With the next-generation model now in dealer showrooms, sales are steadily increasing thanks to the arrival of the crew-cab version at the end of February.

“Pent-up demand due to the flooding crisis a few months ago, the first-car tax-rebate, a first full year of sales and segment growth (all are) expected to boost sales figures for the all-new Colorado,” says Antonio Zara, vice president-sales, marketing and aftersales for GM Thailand/Southeast Asia and Chevrolet Sales Thailand.

GM Thailand’s total sales in the year’s first two months, including cars and commercial vehicles, reached 9,001 units, a 121.4% spike from year-ago, pushing its share to 5.4%.

GM Thailand President Martin Apfel says February’s 5,216 deliveries, alone, represented the subsidiary’s “best-ever performance,” up 145.6% compared with prior-year. The result put the auto maker ahead of Mazda for the year, as well as Honda, although in that case the picture is distorted by supply-chain constraints due to Thailand’s floods last year.

Apfel was upbeat at the recent Bangkok auto show, telling journalists, “We will more than double our sales in Thailand year on year.”

Ford Thailand also is on track for a profitable year, up 60.2% to 6,656 sales in the first two months, nudging its share to 4%. Ford was the clear winner in new-car segment thanks to the Fiesta, which was up 70.1% for a 7.7% share of its subcompact segment.

GM car deliveries trailed Ford’s, jumping 43% to 2,797 units in the first two months. However, the Chevy Colorado led the pickup segment, with 4,343 units against Ford’s 1,852.

“This is definitely a very good start to the year,” says GM’s Zara. “There is still a long way to go, but based on the momentum of last year’s growth, plus new and exciting products we will be introducing this year, including entry into new market segments, I am confident we will remain very competitive moving forward.”

There is a new spring in the Detroit auto makers’ steps. In the days prior to the Bangkok show, both brought the international press here for stylish pre-show debuts of the Ford Focus C-segment car and Chevy Trailblazer midsize SUV.

Ford started off its plan for eight vehicles by mid-decade in Thailand and across the ASEAN region with the Fiesta B-car, and that’s been a success story, breaking the traditional lockout by the Toyota Vios/Yaris and Honda City. Indeed, Thai Fiesta bookings broke through the 30,000-unit mark just weeks ago.

GM has a similar story with its C-segment Cruze, giving consumers a fresh alternative to the Toyota Altis and Honda Civic. Last year, the Cruze took a 9% share of the segment with 8,296 units sold. And this year it has pushed into second place, albeit helped by Honda’s supply problems.

At the auto show, Ford displayed its Australian-built Territory SUV, ostensibly to gauge public reaction, while GM showed off its eagerly anticipated next-generation Trailblazer.

But the real surprise was GM’s rollout its new Chevy Sonic B-car with the announcement it will be built here starting later this year. Stung by the success of the Fiesta, GM is moving fast to grab a foothold in the segment with an all-new contender.

While Ford’s Asia/Pacific renaissance started in the subcompact segment, GM has instead chosen to press the utility vehicle button forcefully. Its Captiva cross/utility vehicle is a big hit, commanding premium pricing and squeezing out Honda’s CR-V to lead the segment, helped by the option of a diesel variant.

Captiva sales last year hit more than 6,000 units, giving it a 45% share of the segment. And it has continued the momentum in 2012, with January deliveries taking an 83% slice of the segment, while Honda was nowhere to be seen.

GM now is taking on Toyota’s dominant Fortuner in the D-SUV segment with its new Trailblazer, which is spun off the Colorado’s new midsize-truck architecture.

GM is going head-to-head with the popular Japanese SUV, announcing a price range that mirrors Toyota’s, ranging from 1.05 million baht to 1.48 million baht ($32,367 to $33,921). GM’s offering does have a couple of tricks up its sleeve – the new model is seven years younger than the Fortuner and offers an optional 6-speed automatic that is a segment first.

Both Ford and GM are pumping money into infrastructure as well as product. Faced with soaring demand, Chevrolet Thailand is introducing a third shift for its Colorado truck production.

Chevrolet sold 7,918 Colorados in Thailand in the first quarter, Apfel recently was quoted as saying. The company will begin shipping the pickups to non-Asian markets April 23 and plans to begin exports of the Trailblazer, launched last October, in the second half of the year.

The new Ford Mfg. Thailand plant, which unlike the existing Automobile Alliance Thailand factory shared with Mazda, is wholly owned by the auto maker and is part of Ford’s 14 billion baht ($450 million) Thai investment.

Ford has a highly ambitious regional rollout in the subcompact segment coming thanks to the new facility. Following the Focus will be a Fiesta-based EcoSport CUV, which likely will debut at December’s International Auto Expo in Bangkok before going on sale across ASEAN in the first quarter of next year.

Production should peak at about 30,000 units within two years, the auto maker says. Also in two years’ time, the FMT plant will add a new B-segment multipurpose vehicle. Its production will rise to about 60,000 units annually by 2016. The next-generation Fiesta car also will be built at the plant starting in 2014 at about 20,000 units more annually than the existing model.

At present, FMT has a projected capacity of 150,000 units annually, but Ford is trumpeting the facility’s flexibility, and word is that 180,000 units easily could be achieved. This would sit well with the auto maker’s B-segment onslaught, which is likely to call for more than 175,000 units annually within four to five years.

Both Ford and GM point to the workforce here as Thailand’s core attraction.

“(It’s) one of the reasons why we are here,” Ford Thailand President Peter Fleet tells WardsAuto at the Bangkok show. “(The) prospect of proper employment is a big deal,” he says, adding that Ford’s staff is highly motivated, loyal and has a low churn rate.

GM Thailand Chevrolet also is expanding, adding 1,500 jobs in the next few months as it stretches its Rayong plant to a triple shift six days a week.

Across the auto makers’ retail operations, new dealerships will spring up this year, with Ford adding up to 30 new stores. Apfel says Chevrolet has dealerships in every province right now with 92, plus eight under construction, taking the auto maker to 110 dealers by the end of the year.

– with Alan Harman