Apart from Malaysia's Proton, there are no major South East Asian motor manufacturers, but millions of vehicles and their parts are produced in five of the ten ASEAN nations. Vietnam, Malaysia, Indonesia, The Philippines, and Thailand all have motor vehicle and spare parts factories for both local markets and exports. Mainly Japanese manufacturers set up and run factories in South East Asia to benefit from better logistics, lower costs and tax reforms in the local markets.
Logistically it's easier, as well as less expensive, to transport fully built up vehicles and genuine replacement parts for Japanese vehicles from these countries than it is from Japan. Thailand, in particular, has many logistical advantages for exporting the vehicles and their spares. Lower costs arise from less expensive land, fuel and labour, although quality remains the same, due to strict management by Japanese QC staff and well-trained locals. Finally, tax reforms are available for cars produced in ASEAN and sold in the local markets.
However, only about half of the vehicles produced in the area are sold and used there. The other fifty-or-so per cent are exported for sale in markets all around the world, making ASEAN a major player in the manufacture of motor vehicles and their genuine spare parts. Although Indonesia has an ambitious plan to compete with Thailand as ASEAN's main producer, it has a very long way to go. Thailand is currently head and shoulders above the rest of ASEAN for production, domestic sales and exports of genuine spare parts and complete cars, SUVs, MPVs, pickup trucks, and commercial vehicles & trucks.
For brands such as Mitsubishi, Thailand is far and away the largest local producer and exporter, with some of the company's models only made in Thailand, regardless of where in the world they are sold and driven. Other Japanese brands include the ubiquitous Toyota, as well as Honda, Mazda, Nissan and Isuzu. In total, there are 18 brands of vehicles being made in Thailand, with a total annual output of nearly three million units. In addition, there are more than two thousand parts producers, including those with make original equipment parts and genuine replacement spares for many different vehicles.
If Indonesia, with a current output of 1.2 million vehicles per year, expects to dethrone the local leaders, it will have to more than double its efforts to surpass Thailand's 2.46 million. Indonesia's growth far exceeds the region's 2-3%, but it appears that Thailand will be leading the production and export of motor vehicles and their genuine parts for some time to come.