Auto service competition to heat up as players expand

Car service center chains throughout the Kingdom are planning to expand this year, and it is feared that this expansion of modern auto centers will sweep out old-styled shop-house centers.

Bridgestone Sales (Thailand) has been highly successful in persuading shop-house auto services to turn to its modern Cockpit Car Service Center. There are currently 45 Cockpit center branches and the company plans to open more, to increase the chain members to about 100 in 2000. Bridgestone Sales (Thailand), however, owns only 9 of those centers, while the rest are franchised.

B-Quik, the service center operated by Ford Operations (Thailand), is another modern auto center chain which is highly successful in the market. Ford has 26 branches as of last year, and the number will be increased to 60 this year.

The Petroleum Authority of Thailand is to improve the first V-Care center on Vibhavadee Rangsit Road to be its prototype shop for expanding.

Max Auto Express, the ‘fast-fit’ center, has opened a total of 40 branches over the past 2 years, and ten more branches have been planned this year.

Heineken brewer to launch new beer for mass market

Thai Asia-Pacific Brewery, producer of Heineken beer in Thailand, is set to launch Amstel, a new 5.5-degree beer, in the middle of February aiming to tap into the mid-level beer market, which is between Singha, Leo, and Chang beers. The new beer will be brewed to find a new market niche after losing some share in the premium beer market to Mittweida beer launched last October by Boon Rawd Brewery.

According to industry sources, Thai Asia-Pacific planned to meet with distributors and wholesalers in the middle of January to prepare for the launch. The price of the new beer would be very close to that of Boon Rawd’s Singha beer, but to be above those of Boon Rawd’s Leo, and Chang beer of Thai Beer 1999. However, PR manager of Thai Asia-Pacific would not confirm the price.

Boon Rawd said the Mittweida launch has forced Thai Asia-Pacific to narrow its profit margin and give away more profits to retailers. Thai Asia-Pacific now gives 5 baht per bottle to the owners of pubs, restaurants and other entertainment premises in order to promote beer sales.

Boon Rawd, meanwhile, plans to increase its number of distributors from 40 to nearly 360 to boost Mittweida sales.

US group increases ownership in Sansiri holding

US-based investment group, Starwood Capital has exercised its right to buy capital increase shares in Sansiri Plc. The purchase was in line with the company’s plan to increase the US group’s ownership in one of the leading property developers in Thailand. Starwood bought 8 million more Sansiri shares, for 8 baht each, in a deal secured on January 11, said Srettha Thaveesin, managing director.

The buy-up has countered the earlier rumors that the US group was about to withdraw from the Thai developer, which early last year was on the brink of insolvency. The latest buy-up has increased Starwood’s ownership to 7% in the new holding. The two parties agreed last year that the US group would increase its ownership to 51% over the next three years.

A total of 1,249 million capital increase shares were sold at the same time, including 625.28 sold to financial institutions, or creditors, to repay debts.

Sansiri insisted that it still enjoys full support from the US group. The company’s outstanding debt currently stands at Baht 770 million.

GM (Thailand) switches from Opel to Chevrolet

General Motors Co. has changed its mind after finding that the name Opel might not be attractive enough in the Thai market. GM’s local operation, GM (Thailand), is set to launch the first Thai-made Chevy instead, and the brand Chevrolet would be used in this regional market. General Motors recently set up Chevrolet Sales (Thailand) to be the distributor of the first Thai-made Chevy model, Zafira, said industry sources.

The first Chevrolet model ever produced in Thailand is to be introduced to the market during the BOI Fair next month. Prior to that time, Chevrolet Sales (Thailand) would start introducing the Chevrolet name to dealers and distributors; the US car logo would be put up at showrooms nationwide this month, said the sources. Chevrolet will make cars to cover all market segments, while the German car maker produces only passenger cars under Opel brand name, said a GM source.

Besides passenger cars, GM has planned to launch several other vehicles, which include pickup trucks, to this local market.

Opel cars do not have a successful record in Thailand under Pranakorn Automobile group - its long-time distributor. Sales of Opel Corsa were impressive, but after sales services failed to impress customers.

Property auctioneers upbeat on huge oversupply

Both foreign and local auction firms are seeing a boom in used home sales as banks and other financial institutions try to clear their stocks. Most of the houses up for auction in the coming weeks have been repossessed by creditors.

Auctions organized over the past two years have set new prices in this local land and house market; the prices have more or less reflected reality, industry sources said.

Asset Auction Center Co., a local auctioneer, is set to put SV City living units up for auction. The riverside condominium units belong to the Sahaviriya Group, which was badly hurt in the Thai crisis.

There are more land and house developing projects going up for sale this year, said an AACC source. Auctioned prices have been between 60-70% of market prices, the source said.

Cushman & Wakefield from Australia has also joined the auction business here. Harrison Realty, and El Gila & Associates, have been in talks with about 10 local land developers about cooperation in auctions. Aha Auction Co. is set to sell repossessed land and house worth over Baht 1 billion for Thai Farmers Bank later this month.

Hundreds of thousands golfers to fly in this year

About 300,000 golfers are expected to come to Thailand for golf tournaments this year under promotion packages endorsed by the Tourism Authority of Thailand. The golfers - from Europe, the US, and Asian countries - are expected to spend Baht 2.5 billion while staying in the Kingdom, said Patchpong Apichartapong, deputy TAT governor for marketing.

While road shows to Japan and other markets have been planned in the middle of the year by private companies, TAT is to organize Thailand Travel Mart festival in the same months - in Saraburi Province which is about 100 km north of Bangkok. The golf exhibition has already won 150 participants from all over the world, Patchpong said. About 50,000 golfers travel to Thailand regularly each year.

Notes: Each of the top ten golf course welcomes 6,000-7,000 golfers a month. Golf in the eastern provinces, which include Pattaya, have been the most popular destinations. French companies recently set up ‘Golffie Club’ to be the coordinating center for European players. Golfers in Florida and California have started to come to Thailand, as the cost here is 5 times lower than in the US.

Internet: No more price war, but service to be improved

Most Internet Service Providers have adjusted their marketing strategy as the industry is entering into the new millennium, with price wars being set as the last thing they would resort to. Most local ISPs said they would try to capture more share of the organizational market, and would not focus on selling Internet-hardware bundles any more.

Theerachai Pongpana, managing director of Samart Infonet Co., said competition in the home user and retail Internet market is likely to heat up this year after the constant growth the industry experienced last year. The high growth in e-commerce in Thailand has been among factors which would stimulate growth in Internet service this year, Theerachai said.

CS Internet of Shin Corp brought down their per hour fee to 15 to 16 baht late last year while that of its ‘Easy Kit’ is as low as 12 baht per hour for late night surfers. KSC bases its connection fee at 15 per baht hour, the lowest price in the country. Loxinfo, meanwhile, brought down its rate and increased using time for old customers.

Copyright 1999 Pattaya Mail Publishing Co.Ltd.
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Updated by Chinnaporn Sangwanlek, assisted by Boonsiri Suansuk.