(Corrects domestic sales target in paragraph 8 to 160,000
* Honda's Thai unit production cut to 60 pct of capacity
* Startup of new plant to be delayed by up to 1 year
By Pisit Changplayngam
BANGKOK, May 22 The Thai unit of Honda Motor Co
has cut production at its Ayutthaya plant to 60 percent
of capacity to reflect weak domestic demand, voicing concerns
sales may fall short of its target this year after months of
Thailand's auto sector, southeast Asia's biggest, is one of
the more visible victims of the weakened economy and unrest
which culminated on Thursday in army chief General Prayuth
Chan-ocha taking control of the government in a coup.
The sector has fired more than 30,000 subcontracted workers
this year and slashed production, as sales plunge after months
of political unrest that threatens to drive some manufacturers
The Japanese carmaker has also decided to delay by between
six months and a year the startup of a new $530 million plant
from its previously planned April 2015 date, said Pitak
Pruittisarikorn, executive vice president at Honda Automobile
"We have been worried about the unfavourable conditions
since earlier this year, both economic and the political
situation," he told reporters on the sidelines of a marketing
The Ayutthaya plant has an annual capacity of 300,000
vehicles, while the new plant under construction in Prachinburi
will have an annual capacity of 120,000 vehicles, he said.
The production cut, which involved scrapping overtime
shifts, reflects weaker demand and aims to clear unsold stock,
Pitak said, adding its inventories were now back to normal.
Pitak said Honda's sales in Thailand may miss a target of
160,000 vehicles this year, while overall domestic sales are
likely to fall below 1 million vehicles.
Domestic auto sales in April dropped 33.2 percent on the
year, according to data from the Federation of Thai Industries.
Sales fell 7.7 percent to 1.33 million cars in 2013.
Domestic sales have declined since the ending in 2012 of a
government first-car subsidy scheme, which had boosted sales 81
percent that year.
(Writing by Khettiya Jittapong; Editing by Matt Driskill and