Eastern Star in talks with Singapore’s GRA

Singapore’s affiliate of the US GRA investment group has been in talks with Eastern Star Real Estate for a possible buy-in deal. The Singaporean side recently sent a team to explore ES’s construction sites in Rayong province.

The talks were stalled by price issues as the buyer pressed for the lowest ones far below an acceptable level in the economic crisis, said Eastern Star Real Estate’s Managing Director William Cheng. The company is also in talks with a few other foreign investors, he said.

Talks have been going on with at least 3 foreign investors but prices remain an important factor to have a deal concluded. Opening the company to new investors is a way out in the crisis. However, it is still difficult to say if the sell-off negotiation is to be successful, said Mr Cheng.

Company based in Ban Chang ‘green zone’, eyes expats based in Rayong as prime customers; golf courses at Eastern Star Country Club and Resort, Eastern Star Country Club Ban Chang Resort, have been profitable; a consolidation plan helps reduce 60-70 percent of costs.

US producer WDC to join hard disk market in Thailand

Western Digital Corporation, among the world’s five largest makers of computer hard disks, is to start marketing the company’s products in Thailand in January before expanding to Malaysia, the Philippines and Vietnam.

According to the company’s vice-president for Asia-Pacific region Jeffrey Boyce, WDC has 2 factories in Southeast Asia, one in Singapore and another in Malaysia. Marketing activities have been in Singapore for some time before expanding to Thailand and others in the Asia-Pacific market, from which sales revenue constitutes 30 percent of the company’s overall income.

Cervex (Thailand) of Acer Computer Co. is appointed the company’s sole distributor and service provider in Thailand. A 10-15 percent of market share is expected in the first year sales through this marketing approach, which represents global cooperation between WDC, the US Cervex International and Acer International, said Mr Boyce.

Company eyes makers of local brand PCs, which cover 50 percent of PC market in Thailand as prime customers; IDE hard disks with capacity between 2-10 gigabytes to test the market first; company launched an unsuccessful attempt to enter Thai market several years ago as no distributor/representative was appointed; Seagate Technology, however, say WDC is too small to be its rival.

Ericsson chosen to be supplier in CAT Internet phone project

Ericsson (Thailand) said it has signed an agreement with the Communication Authority of Thailand in which Ericsson would design and install Thailand’s first Internet telephone network for the communication monopoly. The service would start from the end of this year.

According to Ericsson’s director for principle customer service Supin Ungrangsri, the company has already started the installation work for the PC-to-phone network, the long-distance phone-call service from personal computers to telephone sets which costs users far less than conventional calls.

The company will install a separate solution to enable another Internet phone system service, the phone-to-phone via the Internet, under which users make calls by using long-distance phone cards, said Mr Supin.

A voice-over solution being installed for first PC-to-phone service; the business rapidly expands abroad as there have been more PC users; a revenue regime being considered by authorities; private ISPs urge free competition in the business.

Seagate predicts sharp fall in market price for hard disks

The largest hard disk maker and leader in the market Seagate Technology Inc. said prices for computer hard disks are likely to fall sharply in the year to come as new technology will create new competition in the industry. Seagate is trying to set a new standard for hard drives in the market.

According to Seagate Technology’s senior vice-president Joel A Sted, the company has occupied 65 percent of markets in Asia and Pacific and sales are likely to grow by about 20 percent next year, despite the economic recession in the region.

Hard disks with capacity of 6 gigabytes have become the new trend in the lower market, while their prices are likely to be the same as hard disks with 4.3-gigabytes capacity, which means hard drives will become cheaper, said Mr Sted.

Seagate aims to maintain the company’s 50 percent share of the Thai market; to lead with new products with high technology; industry sources, however, said Seagate has failed in setting 4.3 gigabyte hard disks to be market standard as buying power has fallen and the industry turns to fix the standard drive at 3.2 gigabyte capacity.

Over 1,000 facories to pop up in 1999-department

About 1,100 factories have obtained operating licenses, and all of them are likely to open up next year, said director of the Department of Industrial Works Thien Metanonchai. However, there will be as many as 2,200 factories closing in the same year because of the economic recession.

1,057 new factories opened in 1998 while 2,107 others were closed, said Mr Thien. Foreign investors have come in a remarkable number looking for locations for new factories in the last two quarters this year, which is much different from the same period in 1997, signaling that there will be more investment to come next year, he said.

The department has been improved a great deal to better service; licenses for factories without environmental problems could be approved within one day, from at least 7 days of consideration in the past, said the department’s chief Thien.

Department to meet ISO 9002 standard requirements in the middle of 1999; the Baht 582 million budget allocated in the next fiscal year will be used mainly in managing industrial-related environmental issues and in quality inspection works; exports of textile products rises to over US$2.5 billion in the first 10 months this year, 10.48 percent up from the same period last year.

Baht 1.1-trilion annual target set for tourism in 5 years

The Tourism Authority of Thailand has prepared itself for hard campaigns in the years to come to meet the Baht 1.1-trillion revenue target in 2003 set by the government. The tourism office, currently under an upgrading process, is expected to become a full ministry next year.

According to Minister to Prime Minister’s Office Pitak Intravittayanan, the tourism industry will change a lot after the authority has become a ministry, as there will be more budget funds and more manpower for the operation.

The country now earns about Baht 270 billion a year from foreign tourists and another Baht 170 billion a year from local tourists, said Mr. Pitak.

The country’s tourism policy has switched to focus more on meeting, incentive, convention and exhibition businesses as there have been more convention centers in the past few years, said Minister Pitak. Promotional campaigns are planned to spur sales in low seasons, while all tourism office directors nationwide will go abroad on direct sales, he said.

New ministry will move to the Rajadamnern Avenue office after Transport and Communication Ministry moves to new location; more products, destinations will be introduced; tourist spots in North and Northeast will get intensive promotions.

Thai, Italian groups in talks to re-launch Fiat and Alfa Romeo models

Pranakorn Yontrakarn (PNA) has been in talks with the Italian car giant Fiat, discussing a plan to set up a joint venture here and reintroduce the Fiat car to the Thai market after the Italian-made models failed to make ground in the past several years. A new company could by ready to hit the road by mid-January.

The new company, whether or not with Italy’s Fiat group, would distribute CBU Fiat models while an assembly plan has been under consideration, said PNA’s executive director Tawatchai Jungsanguanpornsuk. CBU models of Alfa Romeo will also be on sale here by PNA.

Fiat has reportedly chosen Thailand as their assembling center for Fiat cars in Southeast Asia. Fiat technicians have been working with the PNA group for a while in talks with local autoparts suppliers, preparing for a possible car assembly plan, said Mr Tawatchai.

PNA also a major dealer of Opel car while the group’s United Auto Sales (Thailand) sells Hyundai cars; Italy’s Fiat yet to make clear investment plan.

Industry sees rise in outbound tours for next year

More Thais have been leaving the kingdom in group tours between October to December this year while tickets have been fully booked in tour programs to Australia, New Zealand and European countries from January to February next year, at a significant increase from the same period this year.

According to Mr. Chitavee Leelasiri, general manager of Amtra Air Services, one of the five largest air ticket agents in the kingdom, it is more difficult these days to find tickets for outbound tourists as seats are booked up until next year, both to Asian and European destinations.

The new wave of outbound tourists has come after the travel business was shocked by the economic crisis and the fall of baht value in 1997, which made traveling abroad too expensive for most Thais. The upturn of sales in outbound tours were partly spurred by low-priced packages offered by travel agents and airlines to ride out the regional crisis, said industry sources.

The Baht 180 billion market contracted by almost 90 percent this year to Baht 30-40 billion; tickets to Australia and New Zealand fully booked until February; a growth of between 10-15 percent is expected in first quarter next year; agents, airlines switched to focus on family tour.

Marlboro girls arrested for violating cigarette control laws

A cigarette sales promotion held by Philip Morris in a superstore in Nonthaburi recently was interrupted by Nonthaburi police, and Marlboro girls got nabbed for violating laws which forbid active promotion sales of cigarette and tobacco in public. The arrest was the first case ever since new laws to control cigarette and tobacco consumption in the kingdom were promulgated 6 years ago.

According to Dr. Hathai Chitanon of the Health Promotion Institution, which has pioneered anti-smoking campaigns since the early days in this country, the institute had received phone calls from shoppers at the superstore who wondered if such sales promotion was lawful. Nonthaburi police were promptly informed and actions taken, said Dr Hathai.

The Marlboro girls, dressed in Marlboro Scott-tinted mini-skirts, were offering to passing-by shoppers special packages of the US-made Marlboro and L&M cigarettes with a special price - one carton plus one free packet - a campaign forbidden by law, before they got arrested.

Girls face up to Baht 200,000 fine under Tobacco Control Law 1992; police to be more active in enforcing tobacco laws; foreign tobacco firms must respect local laws, puts HPI.

AMD to launch new processors

The world’s second largest producer of central processing units for computers, AMD, has planned to launch the AMD K6-2 at 450 MHz next month, a much faster chip than the company’s K6-2 at 350 MHz currently on the market. AMD chips, renowned for their ‘3-D now’ technology, have clearly won a wider public awareness in Thailand, said the distributor of the processor in the kingdom.

The company has planned to launch the AMD’s new generation CPU K-7 series to the Thai market in the first half of 1999, to be an alternative to the Xeon chip by market leader Intel Corp. AMD’s fastest CPU ‘Sharptooth’ series twill be introduced in the second half of the year, said Mr Shong.

There has been more smuggled AMD chips in the Thai market while the largest computer and software center in Bangkok, Panthip Plaza, has always offered AMD’s products as options to customers. The phenomena clearly indicate rising popularity of the chip, said Mr Chong-Cum Shong, marketing manager/Asia-Pacific of AMD Far East Co.

Power Highland, the sole distributor in Thailand, said AMD has won mass market in Thailand as more local brand computers have switched to use the chips with persuasive prices; sales expected to exceed the target by 40 percent at the end of the year; company has prepared for rapid growth; AMD user club claims to have 50,000 members.

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Created by Andy Gombaz, assisted by Chinnaporn Sangwanlek.