THAI tire maker Deestone Group remains committed to investing 7 billion baht under a three-year business plan through 2017, citing strong demand in both domestic and overseas markets.
Suwicha Vongsariyavanich, managing director, said the company has spent 3.5 billion baht since April 2015 to raise production at its fourth plant making vehicle tires in Nakhon Pathom’s Bang Lane district. Capacity was increased to 10.5 million tires, from 5.5 million.
The remaining 3.5 billion baht will be slated for 2017, possibly to expand its production of tires for vehicles and big trucks.
“Despite the country’s overall bearish new car sales over the past few years, domestic demand for replacement tires is still healthy driven by rising vehicle numbers every year,” he said.
The Yingluck Shinawatra administration’s first-time car buyer program drove overall car sales up by 80.6 percent in 2012 to 1.44 million, 1.23 million of which were bought under the scheme.
Sales dropped to 1.33 million units in 2013, fell again to 881,832 in 2014 and declined to only 799,592 in 2015.
The Thai market for vehicle tires totals about 12 million units per year, while Deestone controls a 12- percent market share.
It is anticipated over the next few years the market will see an average of 5-percent to 10-percent growth potential from 50 billion baht now.
Founded in 1982, Deestone supplies vehicle tires, tubes and specialized tires for all market segments. In 1994, with the establishment of Deestone International Co., the company diversified into bicycle, scooter and special industrial tires and inner tube manufacturing for export.
Some 60 percent of Deestone Group products are destined for export markets in Southeast Asia, the Middle East, Europe and North America. Deestone is a major Thai tire manufacturer, running five plants and subsidiaries in Samut Sakhon and Nakhon Pathom with total investment of 6.5 billion baht. It has 10,000 employees and 600 dealers nationwide.
The company just commenced operation of its fifth plant a couple of years ago, making truck tyres in Kamphaeng Saen, Nakhon Pathom.
The 3.5-billion-baht factory won Board of Investment privileges to manufacture 1 million tires a year using 1,000 employees. Deestone has combined annual production of 10.5 million vehicles tires, 1 million truck tires, 12 million bicycle tires and 6 million motorcycle tires.
Suwicha said though the economy in certain Asean countries remains fragile, the company believes the overall international market for replacement tires still remains vibrant.
Image credits: Deestone Group
