May 31, 2024

Subaru, Motor Image Partnership Remains Strong Despite Thailand Plant Closure


Motor Image Pilipinas has reached out in connection with the impending closure of parent Tan Chong International Limited (TCIL)’s decision to shutdown the Subaru assembly plant in Thailand at the end of the year.

First, it has now been confirmed by Motor Image Pilipinas country manager, Karl Castillo that the Philippines will now source the sixth-generation Forester compact SUV from Japan. It must be remembered that prior to this, Motor Image had plans to switch the sourcing of the Forester from Japan to Thailand.

Second, Castillo has said that TCIL’s decision to shut Tan Chong Subaru Automotive (Thailand) Co., Ltd. TCSAT) was brought on not necessarily by Tan Chong Motor Holdings Bhd (TCMH)’s tight financial situation but due to “the changing landscape in Thailand which has made it [local assembly] unsustainable.”

Furthermore, starting from 2025, the CKD markets served by TCSAT—Thailand, Vietnam, Malaysia, and Cambodia will transition to a Complete Build Up (“CBU”) sales model from Japan. The Philippines is not affected as it already sources its units from either Japan or the US (in the case of the Evoltis).

TCIL reiterates that its partnership with Subaru Corporation remains strong and that they are currently exploring additional viable business avenues together.

Below is the full statement of TCIL that it filed with the Hong Kong Stock Exchange:

Tan Chong International Limited
(incorporated in Bermuda with limited liability)
This announcement is made by Tan Chong International Limited (the “Company” or “TCIL”) pursuant to Rule 13.09 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing Rules”) and the Inside Information Provisions (as defined in the Listing Rules) under Part XIVA of the Securities and Futures Ordinance (Chapter 571, Laws of Hong Kong).

Reference is made to the Company’s announcement dated 8 February 2017 in relation to the formation of joint venture (the “Joint Venture”) between the Company’s wholly owned subsidiary and Subaru Corporation (previously named Fuji Heavy Industries Limited). A joint venture company, Tan Chong Subaru Automotive (Thailand) Co., Ltd (“TCSAT”) was established in Thailand pursuant to the joint venture agreement dated 8 February 2017 between the Company’s wholly owned subsidiary and Subaru Corporation.

The board of directors (the “Directors”) of the Company wishes to inform the shareholders of the Company and potential investors that TCIL and Subaru Corporation announce a strategic decision aimed at driving the Joint Venture, TCSAT towards sustained growth in the ever-evolving automotive landscape. Together, TCIL and Subaru Corporation recognize the need for a forward-looking, future-proof approach to adapt to emerging market dynamics.

After careful consideration, TCIL and Subaru Corporation have jointly decided to undergo a proactive business transformation by phasing out the existing Complete Knock Down (“CKD”) business model, which is believed to be no longer sustainable in the long term.

From next year, the CKD markets in Thailand, Vietnam, Malaysia, and Cambodia will transition to a Complete Build Up (“CBU”) sales model from Japan.

The Joint Venture remains strong, as TCIL and Subaru Corporation continue to remain agile and explore additional viable business avenues together in Thailand, Vietnam, Malaysia, and Cambodia.

TCIL and Subaru Corporation are confident that this strategic decision will position Subaru for continued success in these dynamic markets. As TCIL embarks on this new chapter together with Subaru Corporation, both TCIL and Subaru Corporation remain steadfast in their commitment to delivering exceptional value to customers, partners, and stakeholders.

3 comments:

  1. Magaling talaga basta Pilipinas hindi affected ng mga automotive issues. Magcrash test safety results man yan ng Daihatsu DNGA models, rear snapping axles ng Omoda o closure ng planta ng Subaru sa Thailand, HINDI AFFECTED ang Pilipinas. Weeeeh, di nga.

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  3. Magaling talaga basta Pilipinas hindi affected ng mga toy shipment issues. Magcrash test safety results man yan ng Daihatsu DNGA models, rear snapping axles ng Omoda o temporary closure ng Toy Kingdom stores nationwide dahil sa COVID-19 cases sa bansa. HINDI AFFECTED ang Pilipinas. Weeeeh, di nga.

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