China's car and truck maker Beiqi Foton Motor has made a foray into the Thai automotive market by setting up a wholly-owned subsidiary to handle sales and production of Foton's pickup trucks, passenger pickup vehicles (PPVs) and passenger cars in Thailand.
According to Geng Chao, president of Foton Automobile (Thailand), the Beijing-based company has recently established Foton Automobile (Thailand) Co with registered capital of 102 million baht and headquarters at On Nut Road to take control both of sales and vehicle production in Thailand.
Earlier, Foton's sales were handled by Thai authorised distributor, United Motors Co, formerly DFSK Thailand.
United Motors, however, will remain one of Foton's dealer and a local assembler for Foton's light-duty trucks. United Motor sold 400-500 Foton trucks during 2014-16.
According to Mr Chao, the parent firm has recently signed a memorandum of understanding with Bangchan General Assembly Co (BGAC) to produce Foton's pickup trucks, PPVs and passenger cars to be sold to domestically.
BGAC is a subsidiary of Phra Nakorn Automobile Co, a Thai car distributor and parts maker. It used to be the assembler for Daihatsu, Holden and Opel.
Production is scheduled to begin next month with a maximum capacity of 10,000 units a year.
Foton has already applied for Board of Investment privileges, with company pledging to utilise 40% local content in its production.
Mr Chao said the first Thailand-made pickup trucks will be launched by the end of November and Foton will join the Thailand International Motor Expo that runs from Dec 1-12.
He said the company is upbeat about the Thai market because of the country's geographic location and its position as a car production base in the region.
Although the Thai car market is dominated by Japanese carmakers, Mr Chao said Foton remained confident about its product quality and technology, as well as its world-class components. Foton works with partners from the US and Germany such as Cummins, Dana, ZF and Continental to develop technology, he said.
At present, Toyota controls 30.5% of Thailand's car market, while Isuzu and Honda account for 19.1% and 14.7%, respectively.
The automotive industry club of the Federation of Thai Industries forecast that domestic sales will stay at 750,000-780,000 units this year, down by a range of 2.5% to 6.2%, with exports rising 1-3% to 1.22-1.25 million units.
The country's car production in 2016 is expected to increase by 2-4% to 1.95-2 million units.
Mr Chao expects to sell 3,500 vehicles in 2017 and 6,000 in 2018.
The company also plans to increase Foton's dealers and service centres from 17 at present to 26 by the year-end and up to 70 in 2017.