German automaker Daimler Commercial Vehicles Thailand (DCVT) plans to spend 200 million baht on its distribution centre in Samut Prakan to serve its truck business after entering the Thai market last August.
Last year, Stuttgart-based Daimler AG set up a local company for its commercial vehicle business after ending its seven-year relationship with Hong Kong-listed Tan Chong International Ltd, its authorised manufacturer and distributor of Fuso trucks in Thailand.
Chief executive Sascha Ricanek said DCVT recently set up a spare parts warehouse on Bang Na-Trat KM19 in order to support its after-sales service for existing customers as 11,000 Fuso trucks are on the road.
"This is a long-term investment here," he said. Daimler is confident the local heavy-duty truck market has potential to grow, said Mr Ricanek.
"We forecast the overall market will increase by 5% to 19,000 units this year, thanks to investment in the Thai government's massive infrastructure projects," he said.
DCVT is targeting to sell 500 trucks in 2017, all imported from Fuso's plants in Japan and India.
Mr Ricanek said the firm had to import Fuso trucks for this year and next, but remains committed to a new local assembly facility.
Daimler plans to set up a plant in Chon Buri with production capacity of 3,000 trucks a year, he said. But plant construction may be postponed from November to the second half of next year, as DCVT is still determining whether it will establish a joint venture or go it alone, said Mr Ricanek.
Fuso was owned by Japan's Mitsubishi Fuso Truck and Bus Corporation (MFTBC), but the Stuttgart-based Daimler AG acquired MFTBC's 89.3% stake in 2005.
In Thailand, Mitsubishi Fuso Truck used to run an assembly plant in Lat Krabang district, Bangkok, but the company decided to close it during the 2009 financial crisis. Tan Chong then took over that facility, while Fuso Trucks Thailand, Tan Chong's subsidiary, was the local distributor until last March.
Thailand's heavy-duty trucks are dominated by Japanese brands -- Isuzu and Hino. Japan's UD Trucks, a part of Volvo Group, are now in third place while Fuso ranks fourth. Other players are Western brands such as Scania and Volvo. Mr Ricanek said the company hopes to recapture the third spot over the next several years.
At present, Fuso has eight dealers running 25 locations nationwide. Mr Ricanek aims to expand to 60-70 locations in the next five years.
