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Car industry encouraged to manufacture in Thailand

31-08-2010
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Australia's car industry is being encouraged to shift its parts manufacturing to Thailand. According to an ABC report, a recent forum held by Thailand’s Board of Investment in Melbourne was told low wages and tax breaks mean it is cheaper to make parts in Thailand.

Sally Vitoorapakorn, the managing director of booming Thai company Aeroklas, which employs 800 workers at its car parts factory near Bangkok, was at the seminar in Melbourne.

She says Australian companies should look at sending parts manufacturing offshore.

"Australian companies are very difficult in terms producing to compete in the same industry and from my view I think Thailand is the best to support," she said.

"It doesn't mean that you should close down factory in Australia, but should have both."

Thailand will produce about two million cars this year.

Thai companies already make some car parts for firms including Toyota, Mitsubishi, Nissan and Mazda.

Ms Vitoorapakorn says wage levels in Thailand make it a much cheaper base for manufacturing than Australia.

The forum coincides with the launch of a multi-million dollar Federal Government program aimed at propping up Australian car parts makers.

Federal Minister for Industry Greg Combet has launched a $35 million government plan to help car parts makers develop new products and markets.

He says Thailand's interest in Australian manufacturing is nothing out of the ordinary.

"It's not unusual, and we do exactly the same thing, for trade missions to go to other countries to seek investment," he said.

"But the important thing, from our standpoint, is that we want our industry to prosper and to do that it's got to be competitive."

The Australian industry is still struggling with the fallout from hundreds of jobs cut at Ford, Holden and Toyota this year.

There have also been cutbacks at parts maker CMI Industrial, and the collapse of another supplier, APV automotive components earlier this month.

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