This month will see Suzuki and Mitsubishi join the Thailand eco car parade. Nissan was the first to enter the fray in 2010, followed by Honda, while Toyota is tipped to throw its hat into the ring next year.
For each of these Japanese automakers, the Thai eco car initiative goes in tandem with its India plans. In the case of Nissan, the March in Thailand is the Micra sold in India. Honda's Brio, likewise, is common to both countries while Suzuki's new Swift, scheduled to debut in Thailand, is already part of the Indian landscape.
As for Toyota, a version of the Etios is expected to make its way into the Thai eco car fold by 2013. Mitsubishi has been around in India for many years now but its Mirage may be confined to Thailand for sometime now.
The Tata Nano was, at one point, close to being part of the eco car project but the idea was shelved. Had the script gone according to plan, Tata Motors would have been the sole Indian company in a group dominated by Japanese automakers.
Incentive-driven
The eco car project gets a fair deal of incentives from the Thailand Government and participating companies will have to comply with stipulations like mileage (20 kilometres to a litre) and production reaching 100,000 units in the fifth year of production.
Quite unlike India, the Thai car market is a lot smaller but offers easy access to other countries in the ASEAN region because of FTAs (free trade agreements). Hence, these Japanese carmakers have on their radar Indonesia, Malaysia and the Philippines. Analysts say the short-term will also see Vietnam and Cambodia joining this group of countries.
India, the gateway
These automakers believe India is different because the size of its domestic market alone is enough to keep business going. Some like Toyota are already planning to use the Etios foundation here to create a gateway to Brazil. Nissan exports a large part of its Micra output from India to Europe while the March in Thailand is shipped back to the mother country, Japan.
Honda has had a series of setbacks, starting with the tsunami in Japan followed by the Thai floods, which impacted the Brio schedules. It will use the eco car base to export the Brio within the ASEAN region while the India plant will service the local market, at least for now.
In the case of Suzuki, the drive into Thailand could well pave the way for a bigger play in Asia. India is its biggest production base outside Japan and Maruti suppliers here may get more business in ASEAN thanks to the eco car initiative.
It is getting increasingly clear that Japanese automakers are drafting their strategies for the Asia-Pacific region keeping India and Thailand in mind. Some of them are as keen to build their presence in Indonesia which is being touted as the market of the future.
The eco car programme will ensure, though, that Thailand remains a key hub for ASEAN (for a while) while India can play a role in meeting the needs of markets like Brazil, Russia and South Africa.