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News-Reports

Published on May 8, 2008

Author: Michela

Source: authorstream.com

Slide1:  AFTA: Turning the ASEAN Dream Into Reality AFTA 2002 Symposium Jakarta, Indonesia January 31, 2002 John Parker President, ASEAN Operations Ford Motor Company The Automotive Industry Imperative:  The Automotive Industry Imperative National CKD Product Design And Development Global Low Value-added Limited Exports Low Technology The foundation of sustainability in the auto industry is global competitiveness, which is a function of continued liberalization Regional Integrated Manufacturing ASEAN Today Slide3:  ASEAN Auto Growth… A Strong Recovery Strong Recovery after Crisis, but lags China in overall size. ASEAN Industry Size Only Competitive if Viewed as One Region Auto Manufacturers Have Invested Heavily in ASEAN since 1995…:  Millions US ($) Auto Manufacturers Have Invested Heavily in ASEAN since 1995… BUT… Manufacturing Rationalization starts in 2003: Is it “AFTA” or the “Thai-Phil-Indo FTA?”:  Manufacturing Rationalization starts in 2003: Is it “AFTA” or the “Thai-Phil-Indo FTA?” VIETNAM ? Source: Press Reports When Will Malaysia Join AFTA? Uncertainty Jeopardizes Regional Integration:  When Will Malaysia Join AFTA? Uncertainty Jeopardizes Regional Integration Largest Mid-size Car Market in ASEAN (Represents 35% of ASEAN Vehicle Market). 5% AFTA Duty for CBU Deferred Until 2008 (5 years later than Thailand and Philippines and 6 years later than Indonesia). Malaysia Could Be Integral Part of Regional Production But investment decisions for 2005 are being made today. Damages Investor Confidence in All of ASEAN Gives Economies of Scale Leadership to China CBU AICO: A Great Example of Forward Thinking Delivering Investment into ASEAN:  CBU AICO: A Great Example of Forward Thinking Delivering Investment into ASEAN PARTS BENEFITS Eliminates Duplicative Vehicle Assembly and Supply Bases. Major (Multimillion Dollar) Investment in Both Countries for New Products, possible because of Greater Economies of Scale. “Sneak Preview” into AFTA – product complementation, plant rationalization, economies of scale. Ford Thailand Ford Philippines Slide8:  Reality: China’s Diverting Investment Dollars From ASEAN Source: United Nations (Jan. 2002) 9% of Asia FDI 18% of Asia FDI 61% of Asia FDI 38% of Asia FDI Consider: China took 15% of Automotive FDI in 1990 but that number increased to 64% in 2000. Globally, FDI dropped almost 50% in 2001. According to JETRO, 8% of Japanese MNCs will relocate from ASEAN to China in 2002 because of WTO accession. With WTO Accession, China Will Increase Exports to Member Countries :  With WTO Accession, China Will Increase Exports to Member Countries Unless AFTA is implemented for the auto industry on time in all countries, China will continue to attract more automotive FDI and will soon start to EXPORT. Source: UBS Warburg What ASEAN Should do to Position for Future Growth:  What ASEAN Should do to Position for Future Growth AFTA is key – Regional Tariffs Must Come Down Most Critical Aspect of Growing Volume. Malaysia’s Delay Closes the Largest Passenger Car Market in ASEAN to Regional Integration Until 2008. Meet WTO TRIMs Obligations Now Continuing TRIMs in Malaysia and Philippines Slows Down Global Competitiveness in Component Manufacturers and Prevents Regional Sourcing Integration for Components and Parts. Harmonize Vehicle Emissions/Safety Standards Harmonize “External” MFN Tariffs Will Result in Lower Cost CKD Imports – China Drops to 10% in 2006! Modernize Vehicle Tax Policies Current Structures Actively Suppress and Distort What Consumers Want. Slide11:  AFTA: Turning the ASEAN Dream Into Reality Thank You

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