Namyong Terminal Plc (NYT) is a roll-on/roll-off (Ro/Ro) and general cargo terminal operator at Laem Chabang port. Listed on the Stock Exchange of Thailand last November, the company accounts for the highest volume of cars exported via terminals in Thailand. Chief executive Theparak Leungsuwan discusses the company's strategy and outlook.
What is NYT's business model?
Theparak: Main risks are natural disasters
NYT is the fully integrated Ro/Ro operator of Terminal A5 and also holds a 20% investment in Terminal C0, with berths and servicing areas located at Laem Chabang port in Chon Buri's Si Racha district, Thailand's main deep-sea port for international marine transport. The services we provide include terminal services, car storage areas and warehousing, and other services related to our core business.
Who are NYT's customers?
Our customers are both car makers and shipping lines, for which we focus on providing the best-quality services. We've worked closely with the car makers to create an integrated IT system that allows us to report to them on a daily basis the location and status of their vehicles. For the shipping lines, we provide services related to berth use for docking their vessels and for moving cars or cargo on and off their vessels.
What is NYT's capacity?
Terminal A5 has a maximum annual capacity of 1.2 million cars. We operate 24 hours a day, meaning we handle a range of Ro/Ro operations involving between 2,000 and 4,500 cars per day or about 100,000 a month on average. Our terminal services operation at A5 has three berths capable of handling vessels up to a maximum size of 80,000 deadweight tonnes and the world's largest pure car carrier with a capacity of 10,000 vehicles. We also have total warehouse capacity of 155,113 square metres that we provide to our customers for storage services.
Will NYT expand further in the same business in Thailand or abroad?
Recently we acquired a 20% stake in Terminal C0 at Laem Chabang port with our strategic partner Nippon Yusen Kabushiki Kaisha. This investment helps us to ensure that should Terminal A5 is fully used. We can expand our capacity for Ro/Ro services to C0. C0 has an additional 315,400 sq m and three berths with a maximum vessel size of 80,000 dwt, similar to Terminal A5. NYT also has the right to acquire up to 49% of C0 until 2017.
What differentiates NYT from its competitors?
With Terminal A5, NYT has an 80% market share, and this reflects the services we provide to customers. New entrants will have difficulty gaining a foothold in this business in Thailand since unlike terminal operators in Japan that handle only containers or one brand of automobile, we have to manage 18 different automotive brands with multiple model types and multiple destinations.
The knowledge and expertise that we have gained in the past decade in this business together with the systems we have integrated with our customers such as our port management system, pure car carrier system and "Beyond Ro/Ro Port" services give our customers peace of mind that their products are being delivered on time to their destinations. As a result of our proven success, we've received the Prime Minister's Business Enterprise Award and the Excellent Logistics Management Award 2014 by the Commerce Ministry's International Trade Promotion Department.
What are the biggest risks facing your business today?
Our key risks are natural disasters, as they can decrease global car consumption or hinder our ability to provide our services to customers efficiently. Otherwise, in terms of operations we must continue to ensure the quality of our services so that customers will continue to employ us as their port of choice for exporting automobiles.
What impact will the Asean Economic Community (AEC) have on your business?
The AEC will be a huge opportunity for Thailand and NYT. As the region continues to grow economically, demand for automobiles will increase while tariffs and taxes decrease. Thailand and NYT will benefit from the country's location within the region and the continually growing ecosystem in the automotive manufacturing sector.
Where do you see NYT five years from now?
Our goal is to serve our customers in the best way possible, and we do this by ensuring our quality of service and execution and continuing to expand capacity to meet growing demand. Thailand's automotive exports are expected to reach 2 million cars a year, and through our own capacity expansion and partnerships we'll be able to meet this demand, so our customers can feel comfortable about our capability to serve their needs.
The Executive Q&A Series is presented by ShareInvestor, Asia's leading financial internet media and technology company and the largest investor relations network in the region, with more than 500 listed clients. This interview was conducted by ShareInvestor. For more information, e-mail admin.th@shareinvestor.com or visit www.shareinvestorthailand.com