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Some companies rebuilding, others leaving Thailand

Posted On: Jan. 1, 2012 12:00 AM CST

Some companies rebuilding, others leaving Thailand

BANGKOK—While some of the worst-damaged factories still were working to restart their flood-damaged operations, others, such as SANYO Semiconductor Co. Ltd., decided not to rebuild and opted to move elsewhere in Thailand or outside the country.

The plant owned by the division of Phoenix-based ON Semiconductor Corp., which has made semiconductors, transistors and large-scale integrated circuits in Ayutthaya since 1990, was closed Dec. 25. It had produced 5% to 10% of the company's output, and the flooding disrupted its worldwide supply chain.

One of the worst-hit companies, Honda Automobile (Thailand) Co. Ltd., does not expect to resume operations at its only Thai automotive plant—in the Rojana Industrial Estate just north of Bangkok—until April.

Another hard-hit estate in Ayutthaya province, Hi-Tech Industrial Estate, partially reopened in mid-December. But only 10 of the 140 factories that were shut down for two months were back in operation, including car parts maker AAPICO Hitech Public Co. Ltd. and inkjet printer maker Canon Hi-Tech (Thailand) Ltd., said Thavich Taychanavakul, managing director of the estate.

Hi-Tech is spending more than 100 million baht ($3.2 million) to restore utilities and other services at the estate. It also plans to spend 330 million baht ($10.5 million) to build a new 6.8-mile long dike that is 17.7 feet high vs. the current 13.8-foot dike. The flooding peaked at nearly 16 feet, Mr. Thavich said.

The estate will take out loans to build the dike and pay for it by doubling the central utility assessments it charges factories in the estate. Despite those plans, Mr. Thavich said that “3% of the companies in the estate will relocate to minimize risks of disruptions in the future.”