Honda May Scrub Second Thai Plant Due to Political Unrest

Honda says the army-imposed state of martial law in Thailand is leading it to reconsider a second assembly plant targeted for production launch in April.

“We are watching the political situation in order to decide to go ahead with the plan (to start operations) or not,” Honda Thailand spokesman Teruhiko Tatebe tells the Bangkok Post.

“If the political situation improves, we may complete the factory and start production.”

The army declared martial law in an announcement on military TV, saying it had acted “to restore peace and order for people from all sides.”

Toyota, Thailand’s biggest automaker, says it is watching events carefully, but tells the newspaper all three of its plants are operating normally.

“The morning shift started as per usual at all plants,” a spokesman says. “A decision concerning the evening shift will be made based on the situation.”

After months of sometimes deadly anti-government street protests, an overturned general election and the controversial court-ordered removal of caretaker Prime Minister Yingluck Shinawatra, the army generals ordered troops onto the streets of Bangkok.

Yingluck’s brother, Thaksin Shinawatra, was deposed as premier in a 2006 coup.

Yingluck’s supports are warning of civil war if power is handed to an unelected leader, as the street protestors demand.

The government’s National News Bureau reports the Ministry of Foreign Affairs told a meeting it called of 73 diplomats from 57 countries that martial law was invoked to maintain peace and only some sections of the law will be used.

It says all Thai government departments are able to operate as usual and martial law will be lifted once the situation returns to normal conditions.

The Thai government says Acting Prime Minister Niwattumrong Boonsongpaisan remains in power.

“Everything is normal except the military is responsible for all national security issues,” a spokesman tells reporters.

The Thai Chamber of Commerce says the imposition of martial law is good for the country in the short term, but might negatively affect the economy in the long run.

Chamber President Issara Wongkusonkit is quoted by the National News Bureau as saying the army’s declaration of martial law made Thai and foreign people feel confident in the country’s capability to maintain peace and order.

But Issara says martial law might not give positive effects in the long run and suggested the army evaluate the necessity of the law.

He says Thailand should have a government with full power to run the country and prefers a prime minister and a government elected by the people in a democratic process.

Before the army took action, Federation of Thai Industries Vice President Wanlop Wittanakorn called for the swift establishment of a new government to prevent any further deterioration of the economy.

The National News Bureau quotes Wanlop as saying GDP growth this year would only be in the range of 1%-2% if the political turmoil persists and could even enter a negative zone if the situation escalates into a violent standoff.

The bureau reports the government is proposing a new general election for Aug. 3.