Buyers sought for Fuso plant

       The Japanese truck maker Mitsubishi Fuso is expected to finalise talks with two or three manufacturers next month for the purchase of its plant in Thailand.
       Once Mitsubishi Fuso Truck and Bus Corporation (MFTBC) completes the talks, Fuso trucks will continue to be built in Thailand, said a senior official source in the Thai unit of MFTBC.
       Daimler AG of Germany announced earlier this year it would shut the Fuso plant in Thailand by the end of this year as part of a revamp of MFTBC. The German carmaker holds an 85% stake in MFTBC and Mitsubishi Corporation the rest.
       If talks fail, the source said Mitsubishi Fuso Truck (Thailand) Co (MFTTC), a subsidiary of MFTBC, could import Fuso trucks from Indonesia or Malaysia, two major production bases of MFTBC, to keep the brand alive.
       The Indonesian Fuso plant builds more than 40,000 units per year and the Malaysian one 10,000.
       The Japanese truck maker pledged to continue doing business in Thailand even if the plant closes.
       A potential investor is Tan Chong International, a listed automobile and property group in Hong Kong.
       A subsidiary, Tan Chong Machinery Ltd, holds a 100% stake in Nissan Diesel Thailand Co, which is authorised by Volvo of Sweden to produce and distribute Nissan UD trucks in the Thai market. Volvo holds 100% interests in Nissan Diesel Motor Co of Japan, which manufactures and distributes Nissan diesel trucks and buses.
       The source said Tan Chong was interested in the Thai Fuso plant because its licence to build and sell Nissan UD trucks would soon expire.
       But another source in Nissan Diesel Thailand denied an earlier report that Tan Chong would leave the Nissan UD business since its performance was still healthy despite the recession.
       Seiji Akiyama, the president of MFTTC, said the company was approached by many prospective buyers to purchase its plant after it announced it would cease production.
       "There are ongoing negotiations with many interested buyers, and there have been talks about production for domestic sales as well as export that would raise the capacity of the plant. But consideration needs to be given to production costs so that it is competitive,"he said.
       In the past, the Fuso plant had a capacity of 6,000 units per year, but now it assembles about 2,000 trucks per year for the domestic market.
       The plant was originally scheduled to close at the end of this year, but if negotiations bear fruit, production could continue, buoying the confidence of dealers and customers.
       The company said Mitsubishi Fuso remained committed to marketing and servicing commercial trucks in Thailand and continued to invest in products and services for the local market. Asean is the largest international sales area for MFTBC.
       MFTTC announced earlier this year changes in its business structure intended to improve competitiveness.
       A principal change is the integration of Thai production into the overall Asean footprint of MFTBC. This move is to increase overall competitiveness in Thailand by generating further economies of scale. As a result, MFTTC plans to phase out production at Lat Krabang, a suburb of Bangkok, by the end of 2009.
       The local production capacity and workforce will be gradually adjusted.About 150 people are currently employed at the Lat Krabang plant, which makes light-, medium- and heavy-duty trucks.
       In the first half of this year, Mitsubishi Fuso sales grew by 2% compared to a 19% decline in the truck market. By the end of the year, Mitsubishi Fuso is expected to hold a 10% market share,about the same level as last year.