China's Dongfeng Motor (DFSK), which makes compact commercial vehicles, plans aggressive market expansion in ASEAN after a successful foray into the Thai market.

Thailand will be a production base for exporting DFSK vehicles to ASEAN.

Small trucks and minivans were the only two vehicle categories sold in the Thai market through its 100% Thai-owned authorised distributor, Dongfeng Motors Thailand (DFMT). The seven-seat microvan was introduced on May 31st.

All three products are built at DFMT's plant in Chachoengsao.

Dongfeng Motors Corporation of China appointed DFMT exclusive distributor in 2008 and it initiated sales in 2009 under a five-year licence to produce, distribute and service DFSK vehicles in Thailand.

It sold 200 vehicles in 2009, 800 in 2010 and 1,800 units last year.

DFMT aims to increase sales by at least 50% every year starting in 2012, said managing director Pitaya Tanadamrongsak. The sales target is 3,000 units this year and 4,500 next year.

To catch up with rising demand in Thailand and the capacity constraints of the auto plant, DFMT is talking with the Chinese company to expand its plant. The plant produces 400 vehicles per month, trailing customer orders and leaving a backlog of 1,500 units.

Expansion costs 200-300 million baht (US$ 6.3-9.5 million) and is expected to commence next year, as higher sales are projected the next two years in Thailand and ASEAN.

Mr. Pitaya said DFMT hopes to sell 10,000 vehicles in 2015 in Thailand and 30,000 units in 2020 in ASEAN including Thailand.

DFMT will continue to concentrate on compact commercial vehicles with engine sizes under 1,600 cc in Thailand, with no plans for passenger cars. Rather than appointing new dealerships, DFMT will focus on enhancing service efficiency.