Si Racha, Thailand – Tire maker Zhongce Rubber opened its Thailand flagship store in Si Racha, Chonburi province in January, the company told ERJ.
The store is Zhongce’s first direct sales store in Thailand, supplied by its Thai factory in Rayong, and also provides aftermarket services under the company’s chain AutoSpace.
Zhongce’s Thailand factory currently has 5 million unit per year capacity for passenger car radial tire, 1.4 million unit per year capacity for truck and bus radial tire and 300,000 unit per year capacity for truck and bus bias tire. It’s not planning to add off-the-road tire capacity according to the factory.
In 2016 the factory had $10 million (€9.4 million) sales in the Thailand market, compared to just over $1 million sales in 2015 since its opening in mid year.
“We had a lower growth rate in China’s domestic market, which is becoming saturated,” the factory told ERJ, “and Thailand’s aftermarket also has larger demand.”
Compared to the China market, Thailand’s aftermarket services are dominated by overseas brands at higher prices, but it hasn’t affected the consumers’ inclination to spend more on maintenance, said the factory.
The Thailand market also has higher brand concentration – mostly Japanese brands such as Toyota, Honda and Mitsubishi – making it easier for cost control of the aftermarket services, the factory added.