Volvo is going after the Thai truck market with local assembly and possibly a linkup with Mitsubishi.
Currently Japanese makes control 98% of the heavy truck market but Volvo Truck & Bus (Thailand) Managing Director Olof Rapp told the Bangkok Post that he's confident they can increase their market share from the current 1% to 10% in five years.
Local assembly should help. Rapp said high import tariffs have made it impossible for Volvo products to be competitive in Thailand. In May the company will begin assembly of its FL8 and FM10 models at the Thai Swedish Assembly Plant where Volvo cars are built. The company also plans to add more dealers and service points throughout the country.
At the same time, however, Rapp said Volvo and Mitsubishi are talking about sharing assembly and possibly dealer networks. Mitsubishi has excess capacity at its plant in Thailand. It also has 25% of the heavy truck market and a strong presence in the medium duty truck segment.
AB Volvo recently acquired 5% equity in Mitsubishi Motors and the two companies have agreed to form a truck sales and subsidiary in which Volvo will hold 20% of the stock.
Asia is a market of increasing importance, which is why there will be regional co-operation, sharing of heavy duty components and joing development of next-generation medium trucks, Rapp said.
He predicted that heavy truck sales in Thailand will reach 20,000 units a year in the next five years.