General Motors to shut down Thailand plant for two months

By DPA,

Bangkok : In one of the first blows to be felt from the “Hamburger Crisis” in Thailand, General Motors Thursday announced plans to close its Thailand plant for two months, paying employees 75 percent of their wages.


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“If we don’t close down we will have an oversupply,” said GM spokesman Chartchai Suwannasevok, confirming the US giant’s plan to close its plant in Rayong province for the months of December and January.

GM’s 2,000 Thai employees will have to take a 25 percent pay cut during the suspension period and the company has offered 258 employees early retirement with 10 months pay, in preparation for a slowdown in 2009.

GM’s Rayong plant has a capacity to produce 130,000 units per annum, but this year’s sales are estimated at 100,000 units.

The plant assembles and manufacturers GM Colorado pickups, Captiva SUVs, Optra sedans and Aveo compact cars, mostly for the export markets.

Thailand is a major automobile assembly hub in South-East Asia, manufacturing an estimated 1.4 million units this year, more than half of which were destined for exports.

The local industry, which has attracted all the major Japanese auto manufacturers such as Toyota, Honda, Nissan, Mazda, Mitsubishi, Isuzu along with US giants GM and Ford, employs an estimated 500,000 Thais.

Thailand is expected to suffer massive unemployment next year as its export industries dry up, due to falling demand in the US, European Union and Japan, the kingdom’s three main markets.

“With orders for 2009 down 20 to 30 percent, Thai factories in all sectors are expected to lay-off at least 500,000 employees next year,” said Thaveekij Jaturajarernkul, chairman of the labour committee and the Federation of Thai Industries.

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