TOKYO - In the early days of Asia's economic crisis, Japan's carmakers were forced to take drastic measures to reduce production in other Asian countries. They cut shifts and closed plants.
Now they are being more selective. In some cases, the Japanese automakers are even increasing production and exports to take advantage of dramatically cheaper local currencies.
Strengthening local operations will make those bases more competitive when the region recovers.
Of course, Japanese carmakers do not expect the economies of Thailand, Indonesia and other Asian countries to rebound soon.
'I believe they'll hit bottom in the middle of this year and then start picking up very slowly,' said Koji Hasegawa, Toyota Motor Corp. director for Asian operations.
Toyota would be 'very happy' if Indonesia rebounded to pre-crisis levels by the end of next year, he said.
Toyota is not putting its plans for Indonesia on hold until then, however. Later this month, its second Indonesian assembly plant is scheduled to begin producing up to 30,000 Corollas a year for the local market.
Its main Indonesian plant reopened on 9 February, after being closed for Ramadan. Toyota has not decided whether the plant will resume two-shift operations. It mainly builds Kijang sport-utility wagons, Indonesia's best-selling vehicle.
Honda Motor Co. has shifted some production of its CR-V sport-utility to Thailand. The CR-Vs built there will be sold locally.
Mitsubishi introduced a new, locally built sport-utility, the Adventure, in the Philippines in late January. The Adventure is the second iteration of a designed-for-Asia model that debuted as the Freeca in Taiwan in September 1997. Mitsubishi plans to build 8,000 in the Philippines this year, rising to 15,000 later.
Mitsubishi also opened a new engine and transmission plant in the Philippines. It already exports transmissions and gears from the Philippines to Thailand, Japan, Taiwan and Indonesia and plans to expand those exports.
With the widest network of operations across Southeast Asia, Toyota has taken the lead in juggling output to meet demand. But it has focused its efforts on Thailand.
Toyota's Thai truck plant will begin exporting one-tonne pickups to Australia and New Zealand that were previously supplied from Japan.
The Thailand-built Toyota Soluna 'Asian Car' has so far been exported in limited quantities to Singapore and Brunei. Toyota is speeding up plans to export it to other Asian markets. It is also altering the car for markets as far away as South Africa.
Siam Toyota Manufacturing Co., a diesel-engine manufacturer owned 40 percent by Toyota, has already boosted its exports to Indonesia, New Zealand and other markets. It ships components, including cylinder blocks and cam shafts, to Japan. Siam Toyota Manufacturing's exports now exceed its local sales.
Toyota is sensitive to the problems of Thai suppliers. Many rely on components imported from Japan. With the devaluation of the baht, those components cost about twice as much as they did a year ago. Many are expected to ask for financial assistance.
'We are ready to hear them,' said Hasegawa. 'If it's needed, we must extend some assistance to them.'