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   BUSINESS NEWS

HEADLINES [click on headline to view story]:
BOI Fair: World business leaders invited to forum

CVD and studios agree to bring down prices of software

IFCT man to be new Bangkok boss

Tanayong mulls US$100 million loan

BMA to start ‘Bangkok 2000’ campaign

Tax on modified vehicles reviewed

French group plans expand Big C chain

Cal-Comp starts new production lines here

IBM set to launch low-price PC and notebook

BOI Fair: World business leaders invited to forum

A total of 72 chief executives of multinational companies have been invited to a special meeting with economic ministers of Thailand to be organized one day before the BOI Fair in February next year. The first top executive who confirmed to join the forum was Gene Sapp, chief executive officer of the US-based SCI System, the world’s second largest manufacturer of printed circuit board assemblies for electronic devices.

According to Chakkramol Phasukvanich, deputy chief of office of the Board of Investment, the BOI Forum has been designed to be a venue for world business leaders and the economic masters in Thailand to meet face to face. Thailand’s Prime Minister Chuan Leekpai will chair the forum, Chakkramol said.

About 800 companies are expected to exhibit in booths inside the Muang Thong Thani Sport Complex, while 42 other companies will exhibit their products in outdoor pavilions at the BOI Fair. BOI will net about Baht 100 million in rent from those companies. The BOI Fair 2000 will also be much larger than the previous fair in 1995.

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CVD and studios agree to bring down prices of software

The largest entertainment software producer and distributor in Thailand, CVD International Co, said it would bring down prices of video CDs starting this month to compete with pirated entertainment software, and negotiations have been underway with several major studios in the US and elsewhere for the same purpose.

Phadet Hongfa, chairman of CVD Group, said it was necessary that the company compete with pirated software, to control market stakes. Prices of video CDs by Universal, Paramount Pictures, Warner Home Video, Fox Video, and Hong Kong’s TVBI, will be sold for Baht 390 a title, from currently Baht 490 a title. Street prices of pirated video CDs would cost only Baht 99 to Baht 160 a title, Phadet said.

Only 25% of video CDs in rental chains are legal, while 90% of the software is illegally sold in the market. Copyright fees make up 50% of the price of software on the market.

CVD currently owns more than 130 CVD Center rental shops, and several other Show Time shops. The new prices will be in affect at all the rental chains around the country.

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IFCT man to be new Bangkok boss

The board of directors of Bangchak Petroleum Plc selected Sirichai Sakornrattanakul, deputy general-manager of the Industrial Finance Corporation of Thailand, as the new president of Bangchak to replace Sopon Supapong, who resigned from the top post of Bangchak Petroleum in June this year. Sirichai’s name will be proposed for approval by shareholders in a meeting scheduled for November 22, Bangchak sources said.

Sirichai, who is already a Bangchak director, is a financial hand with a background in social projects to help develop community businesses. Sirichai is expected to continue all the community projects initiated by the outgoing president, Sopon, the sources said. The new president will also tackle the privatization plan forced by state agencies and companies, which own the second largest state oil firm.

The top seat was declined by Sopon’s long-time assistant Wuthichai Nilnartvong who accused state agencies of favoring foreign investors. Both Sopon and Wuthichai have been under the same pressure, which is that state agencies will force Bangchak to sell the majority of its shares to foreign investors.

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Tanayong mulls US$100 million loan

Kiree Kanjanapas, chairman of Tanayong Co., is considering a new loan package worth US$100 million from foreign creditor banks, to repay debts owed to Schroeder Bank. The loans are already available but it is up to the chairman to decide, said Vichet Banthuvong, a director of Tanayong Plc which is the majority owner of the Bangkok Transit System Co.

Tanayong is in need of huge loans to repay Schroeder Bank debts in order to take back a huge portion of BTSC shares the bank put up for auction last week. Tanayong might need another US$100 million loan package to repay debts owed to another group of creditors led by Credit Suisse First Boston Bank (Hong Kong). CSFB is scheduled to auction BTSC shares on December 7.

Kiree said he will ‘fight to death’ to protect the majority ownership in BTSC.

Interest rates and other benefits will soon be worked out with overseas creditors whose names have yet to be disclosed. The Bangkok Metropolitan Administration in a wait-and-sees situation, but ready to intervene if foreigners are poised to take control over the country’s first electric train system.

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BMA to start ‘Bangkok 2000’ campaign

Krungthep Thanakom Co., the business arm of the Bangkok Metropolitan Administration, is set to launch the “Bangkok 2000” campaign both here and abroad, aiming to attract 7 million Thai tourists and 9 million foreign tourists to the capital city next year. About 200 companies have contended for the right to use the Bangkok 2000 logos to advertise their products.

According to Sureeporn Pipatvattanavong, a PR manager, Krungthep Thanakom will spend Baht 300 million in advertising in the Kingdom and in several other countries. Bangkok will be highly promoted as ‘The City of Cultures’, a new tourist destination in the new millennium. A number of entertainment and cultural events have been planned for next year, Ms Sureeporn said.

10 companies will be chosen as official sponsors of the campaign. Contenders include Thai Airways International, beer giants Boon Rawd Brewery, Carlsberg Brewery Co., and Beer Thai (1997), Kodak (Thailand), Thai Pure Drink (Coke), and Sermsuk Co (Pepsi).

The campaign will be launched abroad by 22 overseas offices of the Tourism Authority of Thailand.

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Tax on modified vehicles reviewed

The department of excise has reviewed the tax structure on Thai-made cars to help boost auto exports and auto sales in the domestic market. The controversial excise tax, which is currently 30% on modified pickups, will be drastically cut in order to help bring down the price of the vehicle. The new excise tax structure will also encourage foreign car makers in Thailand to increase exports.

According to industry sources, the price of locally modified trucks must be more than Baht 100,000 lower than imported models to be competitive. The government last August, after receiving complaints from foreign car makers led by the Big Three, started to consider a new tax to levy on all modified vehicles; a 30%-rate is currently added to another 5%-rate collected from every unit of pickup truck.

Tax on four-door (passenger) pickups, which is currently at the same rate as passenger cars, will also be brought down.

The high tax rate has undermined vehicle modifying businesses, which by law are reserved for Thai nationals. MMC Sitthipol, which assembles Mitsubishi cars in Thailand, earlier put off its plan to make MPVs from four-wheel drive models.

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French group plans expand Big C chain

Groupe Casino Guichard-Perrachon SA, parent of the Big C discount store chain, plans to open at least five branches of Big C each year, with about Baht 5 billion a year in investment. The plan is in line with the group’s policy to expand the retailing chain in Thailand over the next 3-5 years, said Atthapol Uraipraiwal, marketing director of Big C Supercenter Plc.

Big C rolled out its expansion plan as competitors have also announced expansion plans, including France’s Carrefour AG, which earlier announced a plan to expand its hypermarket chain, Carrefour, in Thailand. Big C currently has 20 branches and this is the first time that France’s second largest retail group disclosed its expansion plan for Thailand’s largest discount chain that it took over from Central Retail Corp in the middle of 1999.

Both Carrefour and Tesco-Lotus are set to open new branches late this year and early next year. A new Big C branch would cost Baht 800 million to Baht 1 billion. Casino paid Baht 6 billion to Central Group in Big C.

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Cal-Comp starts new production lines here

Cal-Comp (Thailand) last month started producing local brand PCs for the first time, while its new production line to manufacture VGA cards will be set up soon. CC Fang, director of Cal-Comp (Thailand), said the new PC, under the brand name Phoenix, will be produced in the company’s fifth plant. Cal-Comp plans to bring out 5,000 units of Phoenix PCs a month from the Baht 250-million plant.

The company plans to export 100,000 units of PCs to the Middle East in 2000, while another 50,000 units will be for the domestic market, Fang said. Production of VGA cards is to start this month; all 100,000 units will be for export, he said. Thai Way Information Co. has been appointed as the sole distributor of Cal-Comp’s products.

The first plant is bringing out 1,000,000 units of calculators, 300,000 units of hand-organizers, 30,000 units of cable modems, and 30,000 units of pagers each month.

Cal-Comp also produces a wide-range of electronic consumer products, as well as printers for Hewlett Packard.

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IBM set to launch low-price PC and notebook

IBM (Thailand) is set to launch a new series of PC and notebooks with low prices aiming to tap more into the home computing market. Research by IBM US parent have found that sales of PCs for home users have rapidly grown in Asia. The year-on-year sales of notebook computers have surged by 10% in the first half this year, said Charoenporn Anchaleetham, product specialist, IBM (Thailand).

IBM is set to launch the new ThinkPad ‘I’ series this month; the new model, which will be powered by Intel’s Celeron Processor, with 32 MB RAM, a fax modem, a DVD drive, and a full multimedia kit, will be sold for only Baht 69,900. The price will enable the new ThinkPad series to compete with other brand names in the market, Charoenporn said. The new series will be Internet-ready.

Research also found that users in Asia do not care much about PCs with high performance. IBM currently controls 90% of the organizational market, and overall sales are expected to increase 20% in 2000.

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Updated by Boosiri Suansuk