Industry gloom worsens, lowest in 29 months

The Thai Industries Sentiment Index (TISI) slipped to 87.5 from 89 in October on dismal key indicators such as orders, sales, output and operating results.

Auto production last month dropped to its lowest level in 12 years. Only 23,695 units were assembled, in sharp contrast to the normal rate of about 170,000 units per month.

The 2011 production target is now 1.4 million to 1.45 million units lower than the previous target of 1.8 million – resulting in an opportunity loss of up to Bt200 billion. 

Payungsak Chartsuthipol, chairman of the Federation of Thai Industries (FTI), said yesterday that besides the automobile and electrical-appliance and electronics industries, which were directly hit, other industries were faced with transport problems. 

Although the flood situation started to recover last month, most industries are concerned about the lingering impact of the disaster. The TISI dropped in November for all sizes of business – to 82.6 from 83.2 in October for small, to 90.7 from 93.1 for medium and to 86.4 from 87.3 for large. 

The TISI for the auto-parts, agricultural-machinery, and electrical-appliance and electronics industries were at the lowest level. Auto parts dipped to 57.1 from 59, while appliances and electronics plunged to 66.2 from 80.9.

The TISI looking three months forward recovered to pass 100, at 104.5, from 101.3 in October, reflecting the improved confidence among industries. Orders, sales, output and operating results are expected to improve over the next three months. 

“We have to keep an eye on the recovery in appliances and electronics to evaluate growth in Thai industry. Automobiles are not a major concern, as we believe that carmakers and auto-parts suppliers will be able to resume normal operations soon. Despite the pressure from the increase in the minimum wage, I’m still optimistic that industry will experience growth in 2012,” Payungsak said. 

Suparat Sirisuwannangura, president of the Automotive Industry Club under the FTI, said auto production this year would not reach the target of 1.8 million units. 

The best the industry could do was maybe 1.4 million to 1.45 million units. The loss of some 300,000-350,000 units from the flood disruption translates into an opportunity loss of Bt150 billion to Bt200 billion this year.

Auto output this month alone is anticipated at 70,000-80,000 units, far short of the target of 160,000 units. 

The club is hopeful that the makers of cars, excluding Honda, and auto parts will be up and running normally by the first quarter of 2012. Honda is predicted to restart two assembly plants in the second or third quarter, he said. 

Surapong Paisitpattanapong, spokesman for the club, said the 23,695 units rolled out last month was the lowest level in 151 months, or 12 years. It was down 85 per cent year on year and 52.07 per cent month on month.

Auto output in the first 11 months of this year was 1.36 million units, decreasing by 10 per cent from about 1.5 million units in the same period of last year. 

New auto sales last month were 26,069 units, the lowest point in 118 months. This represented a dive of 39.19 per cent month on month and 66.95 per cent year on year.

However, for the first 11 months, new auto sales increased by 4.62 per cent to 739,911 units from the same period of 2010. 

New auto exports in November were 6,258 units, the worst performance in 154 months or 12 years. The decline year on year was a whopping 92.14 per cent, and 88.56 per cent month on month.