Nissan suffers Baht 3.7 billion loss

Siam Motor and Nissan Sales said it has suffered an accumulated loss of Baht 3.7 billion and would have to adjust the prices of Nissan cars for the second time. The group said it had hoped to overcome difficulties from ill-performance by the end of the year, as the sales target has been changed to 19,000 units, about 3,000 units more than the initial target.

Siam Motor and Nissan Sales’ senior vice-president Pornpinit Pornprapa said this year’s performance was expected to be positive after a Baht 1.6 billion loss in 1997 and another Baht 2.1 billion in 1998 due to a sluggish domestic market during the economic crisis. The Thai unit has received a Baht 3-billion soft loan from their Japanese parent, Nissan Motor Co.

The good news is, sales are up. About 2,000 units of Nissan cars have been in short supply. Prices would be adjusted when a minor-changed Nissan Cefiro rolls out this June. The group earlier closed down an assembly plant and moved assembly lines of passenger cars to its pickup plant. Japan’s Nissan insists Thailand would continue to be production base for exports.

Thai-opperated casinos in Myanmar face uncertain future

The two Thai-owned casino and hotel complexes inside Myanmar face an uncertain future after the government turned down requests for a border check-point by the Thai owners, while the Rangoon government rigidly controls gambling activities on the other side of the border. Neither of the places have been operational.

Both Interior Minister Maj-Gen Sanan Kajornprasart and Prime Minister Chuan Leekpai last week expressed a negative attitude toward opening a border check-point for the hotel and casino in the Golden Triangle area, just across the Ruak River from Chiang Rai’s Chiang Saen District. Meanwhile, Burmese officials a couple of weeks ago ordered closed another Thai-owned casino in Tachilek, opposite Chiang Rai’s Mae Sai District, after rifts over the investment project ensued.

The two casinos are owned by Thai groups with good connections. Tachilek opened in February, hiring several gambling experts from Las Vegas.

Burmese partners said the Thais had failed to meet the investment agreement, as a five-star hotel must be built first.

Only a few slot machines are allowed inside the Tachilek clubhouse as very few golfers have visited the place over the past months.

Aviation Department turns down Orient Thai plans

The Aviation Department said flying plans by Orient Thai Airlines have been turned down after 6 months of consideration, reasoning that it was difficult to verify the safety of the airline’s planes and operation. Orient Thai was known to have two TriStar-L 10-11 planes registered with Cambodian Airline’s, the Cambodian-government-owned airline in which Orient Thai has a stake. Orient Thai planned to lease its own planes for operation in Thailand when the airline industry here was liberalized 6 months ago.

Orient Thai had proposed to fly 8 routes in the Kingdom: Chiang Rai-Bangkok, Bangkok-Udon Thani, Bangkok-Ubon Ratchathani, Bangkok-Nakornpanom, Bangkok-Surat Thani, Bangkok-Nakorn Ratchasima, Chiang Mai-Chiang Rai and Chiang Mai-Nakorn Ratchasima, but the department said the airline did not have passenger planes in its fleet.

Industry sources wonder as to what might be the real reasons behind the department refusal, as the second national airline Angel Airline, for instance, also leases planes from foreign companies.

Orient Air said it was about to conclude a deal with the Chinese government to operate 60 chartered flights from southern China to northern Thailand.

World youth travel agencies gearing up for big events in Bangkok

The world’s leading travel agencies for youth have planned to organized a sales exhibition in Thailand later this year to woo both local customers and sellers. The Imperial Queen’s Park Hotel has been selected as the venue for a 10-day exhibition by the World Youth Student Travel Council this September, during which about 1,000 buyers and sellers have confirmed to take part. The organizer would collect US$700 a booth in rental.

According to Ms Saichalee Wannapruek, international conference director of Tourism Authority of Thailand, the WYSTC chose Thailand because it viewed the Kingdom as center of Asia, which is rich in cultural background and natural resorts. Thai students have also led the region in traveling abroad, said Ms Saichalee.

Notes: The Imperial Queen’s Park would earn over Baht 100 million for services. Internet cafe planned for participants with service rates of between Baht 100 to Baht 350 per hour. Only 4 local travel agencies, which lead in culture-tour and eco-tour businesses, have been selected to participate in this international event.

IMAX thearter to expand after 6 months in Thailand

IMAX theater said it would continue investing in Thailand by opening up more theaters in Bangkok, Pattaya and Chiang Mai. The announcement came after 6 months of successful operation in the Kingdom, during which the company earned over Baht 70 million from ticket and sponsor sales. IMAX said its 3-D movie T-REX earned a new world record, as the movie has attracted more than 100,000 viewers in just 36 days of shows.

Krung Thai IMAX Theater Co., owned by Krung Thai Bank, Australia’s Cinema Plus Co. and a few other local investors, earned Baht 50 million from ticket sales and another Baht 21 million from sponsor sales in the first 6 months of operation. KTB, Pepsi and Systemma toothbrush were the main sponsors, said IMAX theater’s general manager Mr. Jim Patterson. More than 400,000 viewers had visited the theater, he said.

It is expected that 1,000,000 more viewers will visit the theater in the next 8 months.

IMAX has prepared US$7 million for future investment projects in Thailand. The group is also planning to open 1-2 new theaters in Australia and one more in Latin America or Asia. There are currently 185 IMAX theaters worldwide.

Hotels urged to halve rates during grand sales season

About 300 hotels nationwide have been asked to reduce room rates to promote arrivals during the Thailand Grand Sales push by the Tourism Authority of Thailand. The promotion starts next month, during which billions in earnings are expected from foreign tourists. Thai Hotels Association, however, said rate reduction might be possible only by some of its member hotels, and only during the low-season months.

According to THA’s chairman for marketing and public relations Surapong Techaroovijit, TAT wants hotels nationwide to bring down rates by 50% during the grand sales campaigns in June and November, during which major department stores and shopping centers in Bangkok and major cities promised big discounts. The reduction might be possible only in June, but would be more difficult in November when the traditional high season in tourism begins, Surapong said.

Non-THA members are also urged to cooperate.

The association said there was no need to bring down rates in November as hundreds of thousands of foreign tourists normally flock into the Kingdom.

Major developers on road shows to US markets

More than 10 of the largest property developers in Thailand are leaving for the US early next month on a trade and investment exhibition trip to woo both Thai and US investors. The road shows, organized by Department of Export Promotion, would help increase sales opportunities for Thai products in overseas property markets, and draw back to Thailand much needed foreign investment in the land and housing business.

According to department sources, the sales exhibitions are scheduled to take place between June 5-17 in Los Angeles, Chicago and New York City. Among the 11 companies confirmed to join the road shows are Green Valley Group and Krisda Mahanakorn, which own living estate projects and major golf courses both in Bangkok and the provinces, the sources said. More developers are expected to confirm their participation by the end of this week, they said.

SP Highway Building Co., which operates Dusita Ploenjit Condominium project, said it would offer special prices to US investors and Thais living in the US. Only trouble-free developers are qualified for the US road shows. Land & House Plc, Quality House Plc, Asa House Co., and several others launched new sales campaigns to tap the recovering market, as some start to construct new projects.

Dusit Thani to add spa facilities to branches nationwide

Dusit Thani will invest millions to add water spa facilities to 10 hotels and resorts nationwide in a development plan to attract more foreign guests. The group has also been in talks with Thai Wah Resort Group over a plan to add another wing to the prime Dusit Laguna Resort in Phuket. The hotel wants to add more rooms, as millions of visitors are projected to flock into this southern island province next year. A Baht 10-million spa facility is also included in the renovation plan of the Dusit Laguna.

Dusit Thani has gradually upgraded and renovated its chain of hotels in recent months to cope with the growing tourism industry over the next 1 to 2 years, said Mr. Khampee Suwannadhat, senior chairman of Dusit Thani Hotel & Resort. For example, said Mr. Khampee, swimming pools have been added to the Dusit Resort and Polo Club, Cha-Am and Dusit Resort Pattaya. A spa facility would cost each hotel and resort branch about Baht 5 million in investment, he said.

The occupancy rate at Dusit Thani Bangkok was 62% in the first 4 months this year. The hotel has about a 40% share of corporate customers. Spa facilities are designed to promote longer stays.

New Thai virtual book store on the Net

Business Online Services Co. said it recently started a new online service in distributing magazines and books via the Internet to members. There are 112 titles, from 237 titles of magazines published every day/week/month now available under the BOS BookNet network, while more are expected to join the country’s newest virtual book store at the end of this month.

According to Chatmongkol Khemapirat, chairman of Business Online and Services Co., which is also the publishing house that publishes Quick PC and How To magazines, the new book-online network would especially help increase sales of magazines in Thailand. This would increase earnings, lessening the burden of advertising, as publishers have been finding it more and more difficult to tap from the advertising industry during the Thai crisis.

The service would help publishers reduce costs in manpower and in budgets for public relations. The BookNet would be a boon to existing distributing centers and book agents nationwide. The service also offers job opportunities to thousands with no need of huge investment.

Weakening buying power spurs counterfeiting

Manufacturers in garment industries, ranging from local sportswear to foreign-brand outfits, said that they had suffered from counterfeited products in the economic crisis, and weak buying power of consumers was to blame. Grandsport Co., a major producer of sportswear products, said counterfeit products have pulled down sales of Grandsport wear products by 10% last year.

According to Grandsport’s managing director Ms. Suchada Nimakorn, the company found counterfeit Grandsport products on the market for the first time in the middle of 1998 and about 10 traders have been arrested since.

Grandsport said it was astonished by the recent discovery of more than 1,500 pieces of counterfeited Grandsport outfits at Bo Be market, Bangkok’s largest distribution center for garments.

Diethelm Co., meanwhile, said its Levi’s products have also suffered from unlawful imports and those locally counterfeited. The company said suppression was almost useless as demands in cheaper products with brand names rose in the country’s lower-scale market.

Illegally imported Levi’s garments from Europe and the US have been entering through southern Thailand. Customs officers said counterfeited products were also exported.

TPF to set up new instant noodle plant in Rayong

Thai President Foods Plc, believing that the crisis has already bottomed out, said it has brought back their new plant project in Rayong after two years of delay during the country’s financial turmoil. The new plant, under TPF’s subsidiary Myojo Foods Co., will produce instant noodles for exports, under the company’s plan to turn their Lampoon plant into a production base for domestic consumption.

According to TPF’s managing director Pipat Paniengvej, the company will invest Baht 400 million of its own capital to construct the Rayong plant, which would bring out products for the Middle Eastern and other major Islamic countries. Invitations for the bid over the construction project has been extended to both local and international contractors, Mr. Pipat said.

The Rayong plant would also help cut export costs as freight rates recently rose to Baht 18,000 per container.

TPF’s prime product, Mama instant noodles, has had a 2% growth since early this year, while the company projects a 5% growth for the whole year as costs in raw material have fallen.

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Created by Andy Gombaz, assisted by Chinnaporn Sangwanlek.