China's Zongshen Industrial Group (ZIG) is preparing to produce motorcycles in Thailand to challenge the Japanese bike makers that have long dominated the market.
The 150cc Ryuka Fly is one of the popular models from Zongshen.
Zongshen Hongsi International Co, a wholly owned Sino-Thai joint venture formed in 2009, broke ground last month for its motorcycle factory in Rayong. It will produce motorcycles under the Ryuka brand.
ZIG will invest US$25 million or more than 750 million baht to build the electric motorcycle manufacturing plant. Production will start in 2012 with full capacity reaching 200,000 units in 2015, making Thailand its regional manufacturing hub in Asean.
"Zongshen is entering Asean because it sees high potential in the regional market while Thailand is most appropriate for investment in the region in terms of geographical location that is accessible to Laos, Burma and Vietnam," said ZIG president Zuo Zhongshen.
Zongshen Industrial Group is one of China's largest private industrial conglomerates with more than 30 businesses that include motorcycle, engine and light vehicle manufacturing and real estate.
Mr Zuo said Zongshen intended to promote electric bikes in Thailand in line with the country's policy to address pollution problems and reduce fossil fuel consumption.
The electric bicycles produced by Zongshen can travel 150 kilometres on each charge at a speed of 80 kilometres per hour which is suitable for travelling in urban areas.
The electric bikes cost 20% more than petrol-powered models but owners would recover the cost from fuel savings within a year.
"For this reason, we are confident in gaining recognition from Thai consumers," he said.
Zongshen established Ryuka Sales and Marketing Co as its distributor in the Thai market and is prepared to increase the number of dealers to 400 from the existing 175 once the Rayong factory starts production.
The dealers will receive the support from Zongshen in terms of marketing, after-sales services and parts inventories.
Ryuka entered the Thai market in 2007 and is sold through 175 dealers. Thailand is Zongshen's fifth-largest export market with 12,600 units were sold in 2010, a 15% increase from the previous year.
Credit: Bangkok Post (www.bangkokpost.com)
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