Suzuki Motor Corp, a Japanese automaker, has announced its decision to discontinue car and truck production in Thailand by the end of next year. This move is part of Suzuki’s strategy to shift its focus and resources towards the production of electric and hybrid vehicles in other locations. The company plans to continue providing sales and after-sales services in Thailand by importing vehicles, including EVs and hybrids, from plants in the Association of Southeast Asian Nations (ASEAN), Japan, and India.
The decision to close the factory in Rayong province, Thailand, which has been operational for 12 years with an annual manufacturing capacity of 60,000 units and around 800 employees, comes as Japanese manufacturers face tough competition from Chinese rivals in the country. Additionally, there is a growing pressure on automakers to develop more electric and hybrid vehicles.
Suzuki aims to have a lineup of six EV cars by 2030-2031 and plans to launch its first EV in India next year, with plans for exports to Japan and Europe. By optimizing its global production sites within the group, Suzuki hopes to contribute to carbon neutrality and electrification on a global scale.
The Federation of Thai Industries (FTI) predicts that factory shutdowns in Thailand will continue to increase following the closure of 1,600 to 1,700 factories earlier this year due to economic slowdown, merger plans, or increased operating expenses. The automotive industry in Thailand is facing challenges as domestic sales slow down and exports decline compared to neighboring countries. Malaysia is emerging as a strong competitor, leading FTI chairman Kriengkrai Thiennukul to state that Thailand can no longer be called the “Detroit of Asia.”
This decision by Suzuki to exit the Canadian and United States markets in 2013 also reflects the company’s need to adapt to changing consumer tastes and intense competition. With low sales and a product lineup that did not appeal to American and Canadian customers, Suzuki struggled to compete with rivals selling popular models such as SUVs and trucks. The company made the strategic decision to focus on markets where it still has a strong presence, allowing it to allocate resources more effectively.
Existing Suzuki owners in North America will still have access to parts and servicing through local dealers, ensuring that their needs are met despite the withdrawal of the company from these markets. This move highlights the fast-paced nature of the automotive industry and the need for companies to adapt and evolve in order to remain competitive.