Asean’s largest automotive parts manufacturer, Thai Summit Group, has teamed up with MBM Resources Bhd, Delloyd Ventures Bhd and W&A Ventures Sdn Bhd to be a Tier-1 company to enhance their competitiveness.
The umbrella company — Autoparts Networks Alliances Sdn Bhd — will enable them to promote their businesses locally and overseas. The company will have an authorised paid-up capital of RM5 million and paid-up capital of RM250,000, and they will be increased substantially later.
W&A Ventures Sdn Bhd will hold slightly over 35% of Autoparts Networks while MBM Resources’ subsidiary WSA Capital Corporation, Delloyd Industries (M) Sdn Bhd and Thai Summit’s TS Hi-Tech Seat Sdn Bhd will hold 21% each.
WSA group managing director Dr Wan Mohamed Wan Embong, who is also the president of Autoparts Networks, said on Jan 30 that the group would focus on common areas such as designing, human resource development, manufacturing and supplying of interior and noise vibration and harshness parts and components.
Some 40 parts and components are on the list of their cooperation. This collaboration would later be extended to include joint procurement of raw materials.
“Raw material costs between 55% and 70% of the parts cost and if we can bring down the cost through joint procurement, it would benefit the industry,†he said in Kuala Lumpur at the signing of the agreement to set up Autoparts Networks.
Wan Mohamed, who is also Proton Vendors Association president, said the grouping would eliminate unhealthy competition and instead explore areas of cooperation and synergies.
He said the partners were working on the Proton Iswara replacement model. However, he said the grouping did not plan to squeeze out the other vendors.
He said it had the support of carmakers and assemblers in Malaysia and would help improve members’ core competencies and expand their operations through collective effort to strengthen their competitiveness in terms of quality, cost and delivery.
“We are flexible, members could either brand the parts and components jointly developed as their own or under Autoparts Networks,†he said.
“Our focus initially is to meet the requirements of the local car manufacturers and assemblers to help them improve their competitiveness before moving into the Asean market,†he said.
He said Autoparts Networks would be selectively open to companies wanting to join as they must share the same objectives and vision with the four founding members.
Later, they signed a memorandum of understanding with three foreign partners. The three foreign partners are EDAG Engineering + Design of Germany, Lear Corporation of the USA and LG-CNS of South Korea.
“The annual combined sales turnover of our members in Malaysia exceeds RM350 million while overseas sales are well over RM3.5 billion,†he added.
Deputy Finance Minister Datuk Awang Adek Hussin said the ministry was working with several other ministries and departments on ways to disburse the RM500 million Automotive Development Fund (ADF) under the Ninth Malaysia Plan.
He said the fund would assist and support Malaysian vendors to be on level playing field with vendors from Japan, South Korea, China and others. Finance Ministry Parliamentary Secretary Datuk Seri Dr Hilmi Yahaya read out Awang Adek’s speech.
Awang Adek said Malaysia now has 340 vendors supplying well over RM5 billion worth of parts and components compared with 140 vendors supplying RM2 billion worth of parts and components in 2004.
