The share price of automotive parts producers plunged sharply on Thursday amid concerns of the relocation of big manufacturers from Thailand to overseas.
Prices of AAPICO Hitech Pcl. (SET: AH), Somboon Advance Technology Pcl. (SET: SAT), and Namyong Terminal Pcl. (SET: NYT) plunged as much as 29%, 10% and and 8.50%, respectively, on Thursday after the report by Reuters saying that Isuzu Motors is planning to relocate its factory to Indonesia from Thailand.
The stocks made some recovery as the session progressed, but still in a negative territory.
Agus Gumiwang Kartasasmita, Indonesia’s industry minister, said in a statement that he had met with Isuzu’s executives in Tokyo on Tuesday and the production after the relocation could start as early as next year. Isuzu already has a factory in Karawang, Indonesia.
The minister also welcomed the plan, saying that Indonesia will provide incentives and will support the relocation process.
Thailand relies heavily on car and auto parts exports, accounting for a total revenue of 28 billion baht in 2022 or 9.83% to the GDP.
AH could feel the impact the most as around 39% of its revenue in 2022 came from Isuzu. Meanwhile, SAT generated 11% of its revenue from Isuzu.
In the latest development, the spokesperson of Thailand Board of Investment (BOI) stated that the aforementioned plan for relocation is not yet confirmed and the Board is contacting Isuzu Thailand for more clarification.