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Thai electronics industry has high potential to become a global leader
Thai electronics industry has high potential to become a global leader
Michael McKenzie
The electronics industry in Thailand is well established. From mass-market consumer electronics and component production to outsourced contract manufacturing, global companies have long highlighted Thailand as a destination for investment and expansion. While Bangkok and its surrounding areas are considered to be the hub of industry in Thailand, there are more and more instances of firms finding success all over the country.
Northern Thailand, in particular, plays host to many such companies within the electronics sector; especially with regards to outsourcing and manufacturing. Many companies based in the region have been established in the area for decades with a strong industrial presence in the city of Chiang Mai and the surrounding provinces such as Lamphun.
Finding success in Chiang Mai
The potential of Chiang Mai as a base for an electronics company has not always been the conventional option for companies looking to establish themselves in Thailand. However, there have been many success stories where
firms have invested, grown and become established in the city. One such example is electronic manufacturing services (EMS) provider, Bluechips Microhouse, which has been well-established in Chiang Mai since its formation more than 20 years ago.
According to Managing Director Mr. Thomas Zimpfer, the strategic advantage of Chiang Mai stems both from personal and professional circumstances as “Chiang Mai represented the best balance to provide a settled lifestyle without sacrificing professional opportunity. Despite being much smaller than Bangkok, we have found a very talented labour pool in the city that allows us to offer a specialised electronics service starting from our Research and Development (R&D)
Northern Thailand remains a hub for such contract manufacturing partners due to the balance between competitive costing, its talented workforce and a supply chain access that allows for timely and quality production of full-electronic products.
Department to our manufacturing processes. We have never regretted our choice of Chiang Mai and were delighted to reaffirm our commitment to Thailand when we built our new headquarters five years ago.”
The need for talented teams is vital throughout the electronics industry, but nowhere more so than in the EMS sphere. Customers that require product design and manufacturing often need their products to be continuously optimised to make them smaller, faster or sturdier than those of their competitors.
Making products of the future
With companies all over the world looking to automate processes or use technology to solve problems for their customers, it is common for EMS providers to act as the gateway between new ideas and their realisation in the marketplace. Companies involved in the manufacturing of everything from everyday consumer devices to newly emerging industries, such as e-mobility and smart-metering among others, entrust the production of billions of products to their sub-contractors. Northern Thailand remains a hub for such contract manufacturing partners due to the balance between competitive costing, its talented workforce and a supply chain access that allows for timely and quality production of full-electronic products.
Mr. Zimpfer explained that “nearly all the products contracted to Bluechips are for export. That means we can focus on our procurement, cost and quality without the added pressure of being on the doorstep of our customers. This balance has allowed companies like ours the chance to develop relationships with our clients, which have endured since our first day of business.”
However, EMS being such a global industry means that companies in Thailand have to continue to work hard to be a viable partner for their clients. Support from the Thailand Board of Investment, international chambers of commerce and the network of high-tech companies already established continue to be a vital key to further establishing Thailand as a market of high potential globally.
The challenges ahead
As with many industries, the challenges facing the electronics sector are always influenced by external circumstances. Recent years have seen shifts in the global economic climate via the imposition of tariffs between the United States and China as well as the ongoing and uncertain global threat of the Covid-19 virus. Global incidences such as these invariably have knock-on effects for industry in Thailand.
Nevertheless, for the EMS industry, it is often the case that proactive companies stand to benefit rather than suffer from these volatile situations.
When tariffs were imposed on China, many Thai manufacturing companies were in a position to increase exports to the United States. While global productivity is being hit by Covid-19, businesses with the most prepared supply chains are able to sustain and improve their market shares.
By being proactive and preparing for these short-term market shifts, the electronics industry in Thailand can be best-placed to further establish its potential as a global leader within this industry. The prognosis for 2020 and the years ahead remain very exciting for Thailand.
Contact details:
Michael McKenzie
Marketing Coordinator
Bluechips Microhouse
Tel: +66 533 1000
