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Thailand to Lose 75 Billion Baht Due to Auto Production Cut as a Result of Japan Tsunami

 

One thing I never understand about Thai politicians is their complete inability to see reality or understand basic economics. For weeks now, they’ve been spouting off about Japan’s tsunami “not affecting Thailand’s economy” as Thailand will end up selling more to Japan as Japan rebuilds. Anyone with a brain can see this isn’t true, yet Thai politicians, including PM Abhisit keep yammering on about it.

As always happens though, the truth finally comes to light. In a report in The Nation this morning, it’s been announced Thailand’s automakers will see a drop in production of 150,000 units in the next couple of months. Why? Because they can’t get the parts they need from Japan.

Every westerner I know saw this coming. Every Thai politician? Head in the clouds, pretending it’s not going to happen.

And true to form, yesterday Thai automakers also joined the “if I put my fingers in my ears and sing really loudly, it’s not happening” brigade. With production falling sharply, any automaker in the west would have no choice but to lay off workers. Thai autoworkers say they won’t, but will use the time “to train workers instead”.

Japan meanwhile says normal production levels won’t likely be back until December. Do you really think Thai automakers will keep paying all their workers for nine months when they’re losing money hand over fist? If you do, I have a bridge over the Chao Praya I can sell you.