140402_3rd Annual South-East Asia Automotive Summit 2014_Rethinking Your Localization Strategy
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The document outlines the development of the ASEAN automotive industry, focusing on factors influencing localization strategies, market opportunities, and the production capabilities of various countries in the region. It highlights Thailand's leading role, Malaysia's expansion of local brands, Vietnam's emerging position in OEM parts, and the Philippines' revitalization efforts. The growth in demand for low to mid-class vehicles is driving OEMs to enhance their localization efforts across ASEAN countries.
140402_3rd Annual South-East Asia Automotive Summit 2014_Rethinking Your Localization Strategy
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- 2. 2 Topic 1 Overview of ASEAN Automotive Industries 2 Factor that influence Automotive Localization 3 Capitalize the strength of ASEAN OEM’s 4 Key focus area of OEM’s localization 5 ASEAN Localization Opportunity Agenda
- 3. 3 Rethinking Your Localization Strategy Overview of ASEAN Automotive Industries 141,000 157,000 180,000 730,000 700,000 750,000 2011 2012 2013 Vehicle Sales Motorcycle Sales 110,000 80,000 94,000 3,700,000 3,100,000 3,000,000 2011 2012 2013 Vehicle Sales Motorcycle Sales 850,000 1,100,000 1,200,000 6,800,000 7,000,000 7,700,000 2011 2012 2013 Vehicle Sales Motorcycle Sales 600,000 620,000 650,000 490,000 530,000 540,000 2011 2012 2013 Vehicle Sales Motorcycle Sales 790,000 1,400,000 1,300,000 2,000,000 2,100,000 2,000,000 2011 2012 2013 Vehicle Sales Motorcycle Sales ASEAN Automotive Industry Development in The Last 3 Years
- 4. 4 Rethinking Your Localization Strategy Factor that Influence Automotive Localization - 1 EXTERNAL FACTOR INTERNAL FACTOR LOCALIZATION STRATEGY – Key Focus Area SPIRE Conceptual of Automotive Localization Strategy Manufacturing (Production Capability & Flexibility) Material Purchasing (Sourcing of material and origins) R&D (Adaptations & Organization) Logistics (Delivery Structure)
- 5. 5 Rethinking Your Localization Strategy Factor that Influence Automotive Localization - 2 Topography, infrastructure, traffic condition Average income, purchase power, currency fluctuation, labor cost & productivity, vehicle cost of ownership Climate change, emission control Gasoline quality, material usage & availability, multimedia, arts/component development Government policy, environmental policy, safety regulation, tax regulation, fuel regulation EXTERNAL FACTORS THAT INFULENCE AUTOMOTIVE LOCALIZATION
- 6. 6 Rethinking Your Localization Strategy Factor that Influence Automotive Localization - 3 Type or production capability, on-Time production, high quality product Variety parts can be build vs. specialized parts OEM’s Capacity & capability of OEM company in production, investment in technology INTERNAL FACTORS THAT INFULENCE AUTOMOTIVE LOCALIZATION
- 7. 7 Rethinking Your Localization Strategy Capitalize the Localization Strength for ASEAN OEM’s ASEAN OEM’s Opportunity EXTERNAL FACTOR INTERNAL FACTOR KEY HIGHLIGHT KEY HIGHLIGHT Low-end passenger car is consider to be the highest market demand among other type of passenger vehicle Opportunity for mass production of low- medium class passenger impact to the mass production of OEM parts/ components Small ECO car forecasted to continue with projection of production about 2.5 million units around 2015 Thailand considered as the production bas of vehicle and OEM parts/ components in ASEAN especially in applied automotive technology Malaysia also expand their local brand into several country, e.g. Indonesia. Malaysia establishment of their local vehicle brand Proton and Perodua create more focus to the local brand and local OEM parts. Increasing of 2-wheeler OEM parts maker Low labor provided competitiveness as a supplementary base for automotive industry In several years, Vietnam considered as 3rd option for the OEM parts/component maker to build their plant in Vietnam. The Philippines looks to rebuild and recapitalized their automotive industry. Supply base in ASEAN for transmission parts/ components. Philippines recently promote their capability to produce automotive parts/component since they have highly skilled labor. Less Opportunity Most Opportunity
- 8. 8 Rethinking Your Localization Strategy Key Focus Area of the ASEAN OEM’s Localization Logistics Purchasing R&D Manufacturing Factories extension Production, flexibility Adaptions, technology, innovation, infrastructure R&D organization and human resources Delivery structure, effective logistic system Source of material & origin, quality KEY FOCUS AREA OF ASEAN OEM’s LOCALIZATION EXTERNAL FACTORS INTERNAL FACTORS
- 9. 9 Rethinking Your Localization Strategy ASEAN Localization Opportunity – 1 Future Vehicle & OEM’s ASEAN Localization Opportunity ASEAN countries’ demand for automotive is growing due to the expansion of the OEM players: Other country OEM manufacturing and also others existing OEM company are increasing their production capacity with the increasing demand of vehicle, especially the low-mid class of vehicle. Thailand with its capability, resource and skilled labor is still to be the hub of ASEAN automotive industry. Thailand capability in automotive technology & development is the most influence factor by the OEM’s to built the factory there.
- 10. 10 Rethinking Your Localization Strategy ASEAN Localization Opportunity – 2 Future Vehicle & OEM’s ASEAN Localization Opportunity ASEAN countries’ demand for automotive is growing due to the expansion of the OEM players: Malaysia push to increase their localization parts/components to boost their local OEM manufacture Proton & Perodua. Vietnam is increasing their capability in producing localized parts/ components especially for 2-wheeler OEM parts/components. The increasing number of OEM’s parts/components creates opportunity to increase labor skill. The Philippines is revitalize their manufacturing facility and also increasing their knowledge in automotive technology development.
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