Caterpillar: Thailand our Asean hub

Construction News

With an investment of US$300 million, Caterpillar Inc, the world’s top maker of construction equipment, is in the process of turning Thailand into its main Southeast Asian production base.

Two factories are being built in Hemaraj Rayong Industrial Land, with 95% of the output slated for export.

Richard Lavin, president of the Illinois-based Caterpillar Group, said one of these, a mining-equipment facility, will start producing the first prototype trucks and loaders in the fourth quarter.

The medium track-type tractor factory will start operating in next year’s first quarter.

Caterpillar will employ 2,000 people in Thailand once the two facilities are running at full capacity three years from now, Mr Lavin said during a visit to Bangkok yesterday.

The facilities will be Caterpillar’s two largest plants in Asean.

“We chose Thailand as a production base in order to serve the Asean market as well as Central and Eastern Europe,” said Mr Lavin.

“We find the country to be cost-effective for manufacturing, and we’ll consider upping our investment later on.”

Caterpillar has urged foreign suppliers to invest in Thailand in order to be close to the company’s new factories.

Local production will make Caterpillar products more competitive against Japanese and South Korean makers, said Mr Lavin.

“We intend to be the market leader in Thailand by the end of the year,” he said.

Mr Lavin pointed out the decision to invest in Thailand was made at during last year’s flood crisis.

“We’re confident the Thai government has a good plan to prevent more flood damage this year,” he said.

His remarks came after a meeting with Industry Minister M.R. Pongsvas Svasti in which he asked for government support in the form of improved transport routes to move parts and components from suppliers to the factories.

At present, Thailand is second after Indonesia in terms of Caterpillar plants.


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