Executive vice president Dhanet Yongratanamongkol said Siam Hitachi Elevator expected to expand its annual production capacity from 3,200 units to 5,000 units by 2020 and raise its export proportion from 40 per cent to 80 per cent by that time.
The expansion can be easily done through adding one or two production lines, each requiring an investment of Bt200 million to Bt300 million, he said.
Hitachi currently has elevator and escalator factories only in Japan, Thailand and China. After the production upgrade, Dhanet said the Thai factory, which currently supplies Asian markets, would increase its shipments to the Middle East and also cover European markets.
Siam Hitachi Elevator will be the main export base for Hitachi’s low-to-medium-speed elevators, while the Japanese factory will continue to take charge of high-speed elevators that can ascend at more than 300 metres per minute, mainly geared for high-rise buildings, he said.
Makoto Nagashima, deputy general manager of Hitachi’s Global Elevator & Escalator Division, said the company was considering setting up a fourth global production base in India, but because of that country’s high import tariffs, it would have to make sure it could find locally produced parts.
Siam Hitachi’s local content currently stands at about 65 per cent but it is aiming to find more local parts suppliers to increase local content to 80 per cent in the next year or two.
In the domestic market, Dhanet said property firms, particularly condominium developers, were postponing their purchasing decisions, which might stem from their lack of confidence in the future direction of the Thai economy.
“Developers are delaying signing up, even though we have won many contracts. We expect them to take another one or two months to consider the situation, and decide whether or not to move forward,” he said.
Delayed orders now total about Bt200 million to Bt300 million, accounting for about 40 per cent of the firm’s backlog.
The Thai elevator and escalator market, worth Bt12 billion, is expected to grow by only 3-5 per cent this year. Adding service and maintenance revenues, the market is estimated to be worth about Bt17 billion.
Dhanet said the Cambodian and Myanmar markets had grown quickly, now equal to about one-fourth of the Thai market. Siam Hitachi, a joint venture between Hitachi and Siam Motors, also handles the Cambodia, Myanmar and Laos markets.
The company plans to set up a branch in Laos next year, after already establishing joint ventures with its Japanese parent and local partners in Myanmar in 2015 and in Cambodia this year.
Siam Hitachi yesterday unveiled its latest innovation, the UAG-SN1 elevator, which features a “simplified specification selection process” concept, energy efficiencies, air purification, multi-beam door sensors, and many other new features.
Thailand will be the important production base for this new product, Dhanet said.