Komatsu plans expansion: Casting, excavator operations will grow
Published in: Bangkok Post (Bangkok, Thailand)
Date: 11/15/2006
By: Santan Santivimolnat
Nov. 15–Komatsu of Japan, one of the world’s largest manufacturers of construction, mining and utility equipment, is investing 1.25 billion baht this year in Thailand with its local distributor Bangkok Motor Works Co, to expand in Thailand.
Bangkok Komatsu Industries Co, a joint venture of Bangkok Motor Works and Komatsu, is investing about 500 million baht to expand production of iron-casting products for Komatsu forklift production to 2,040 tonnes per month from the existing 1,250 tonnes.
The expanded capacity is scheduled to begin operation next year, said Phornthep Pornprapha, president of Bangkok Motor Works, which is wholly owned by Siam Motors Group.
Bangkok Komatsu Co, another joint venture of Bangkok Motor Works and Komatsu, is also investing 620 million baht to double production of Komatsu excavators to 6,000 units per year. The first-stage expansion by 1,000 units per year is to be completed next year and the remaining 2,000 units of capacity will be added in 2008.
Both the iron-casting and excavator factories are located at Bang Pakong in Chachoengsao province.
The remaining 103 million baht in capital has been used to renovate the head office of Bangkok Motor Works, located on Bang Na-Trat Km 22.Commenting on the performance of Bangkok Motor Works, Mr Phornthep said local sales of Komatsu products were expected to slip this year as a result of the impact from rising oil prices, coupled with the delay in state budget disbursement which had also caused delays in large state construction projects.
The company projected that it would sell 525 excavators worth two billion baht this year, down 5 percent from 554 units sold last year, which was considered rather small when compared with the growth of the country’s excavator market.
The overall market for excavators in Thailand is expected to be reduced to 1,785 units this year, down 17 percent from 2,161 units in 2005.
The firm expects to sell 650 forklifts this year, compared with 493 last year.
When taking its market share into consideration, Mr Phornthep said Komatsu had performed well this year with sales growing steadily. From January to November, Komatsu excavators took the lead in the local industry with a 29 percent share as a result of its commitment to providing quality products and services to customers.
He was confident that Komatsu could raise its share to 32 percent next year.
The company also exports Thai-made Komatsu excavators to 27 countries. Its major markets are Japan, the United States, Canada, Australia, New Zealand, South Africa, India and Asean.
Bangkok Motor Works started its business in 1956 under the former corporate name Siam Construction Co. The operation grew steadily until 1979, when the company entered into a joint venture with Komatsu as it foresaw the promising prospects for the heavy-machinery and equipment businesses in Thailand.
The company currently has four subsidiaries under co-ventures with Komatsu. The company and its subsidiaries have combined registered capital of 2.33 billion baht, total turnover of 11.37 billion baht this year and 1,217 employees.
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