Thai auto parts makers adapting to changing technologies

Thailand’s auto parts makers have been the backbone of Southeast Asia’s vehicle sector for decades, but the evolution of electric vehicles that require fewer components has many of them exploring new options for making equipment for industries ranging from medical to aviation.

“It’s a pivot to industries that use the same processes because there is already expertise in machining,” Sompol Tanadumrongsak, Head of the Thai Auto-Parts Manufacturers Association, told Reuters news agency.

Thailand’s automotive and parts industry employs over 900,000 workers. Many were furloughed or even laid off during the Covid-19 pandemic as the economy slowed and vehicle sales declined. But the bigger threat to their employment, according to industry analysts, is the advent of electric vehicles, or EVs, which use only 10 percent to 20 percent as many parts as internal combustion vehicles.

Although many automakers in Thailand are starting to switch to manufacturing EVs or hybrids, that still leaves parts makers with a dilemma. Thailand has about 800 auto-parts companies, putting more than 325,000 jobs at risk because an EV uses 1,500 to 3,000 parts, as opposed to 30,000 in a traditional gasoline vehicle, according to Kiriya Kulkolkarn at Thammasat University.

With Thailand’s government actively promoting the EV industry as part of its plans for a greener, more advanced economy, many vehicle parts makers are now scrambling to find other industries that could use the capabilities of their factories and skilled workers.

“We cannot just stay in the auto business,” Kasem Tiankanon, Manager at Siam Filter Products Ltd. said. “If you don’t adjust, you’ll die.”

His company is trying to expand into making filters for industrial and medical use and is developing a new kind of protective mask.

Innovation and adaptability will be the keys to survival for many. Thailand’s industries have shown resiliency during past crises. With the uptake in electric vehicles among consumers moving steadily but slowly, parts makers do have time to develop a roadmap for a sustainable future.

Photo courtesy of https://kmc.exim.go.th/