PACO goes international, entering the Malaysian market by securing a contract for automotive air conditioning manufacturing from a major player in the automotive industry, propelling its new OES business to strong growth, with revenue recognition expected in Q2 this year. The company is confident of achieving a robust 25% growth this year.

PACO Public Company Limited, President Automobile Industries, is making a grand entry into the Malaysian market, expanding its new business of manufacturing automotive parts (OES) by signing a contract with Tan Chong Group, a major automotive player in Malaysia. The company anticipates continuous sales growth as it caters to various brands and types of vehicles, including cars, pickups, trucks, and trailers.

Mr. Somchai Lertkacharakitti, CEO of PACO Public Company Limited, revealed that PACO has received a new contract from Tan Chong International Group, a major automotive manufacturer in Malaysia, for comprehensive automotive air conditioning production to support repairs or parts replacements at automotive service centers (Original Equipment Spare Parts) or OES. This order is expected to significantly boost production and increase OES business revenue by over 50%. The growth in OES production is anticipated to align with the rising demand for vehicle maintenance at service centers nationwide, with clearer results expected around Q1 2022 and revenue recognition starting from Q2 2022. PACO expects total revenue to continue growing by approximately 25% in 2022.

PACO aims to enhance revenue from its core business, which includes spare parts for various automotive air conditioning systems for domestic sales and exports worldwide. The company plans to continuously expand its domestic market with a strategy to grow its comprehensive automotive air conditioning parts network under the PACO Auto Hub brand to 300 branches by the end of this year, which will help increase sales and strengthen the PACO brand recognition among car users in the country, as well as enhance distribution channels. Additionally, the company plans to continuously launch new products, such as automotive radiators, air conditioning compressors, automotive suspension parts, oil coolers, alternators, and starters, while also expanding its air conditioning line for luxury cars. In the export market, PACO expects strong growth, driven by the global automotive market recovery following the reopening of the United States and Europe. The company's primary export markets are in the Middle East, which is experiencing economic improvement due to rising global oil prices, leading to confidence that this year’s performance will meet targets.

At the end of 2021, PACO successfully expanded into a new business by securing contracts to manufacture parts for automotive manufacturers (OEM Market), with its first major client being a large manufacturer focused on electric vehicles, specifically EVs and Plug-in Hybrids, which are increasingly popular worldwide. PACO received orders worth 1.2 billion baht, ensuring stable revenue for over five years for the OEM business and supporting revenue for ten years for the OES manufacturing business. Furthermore, the company has been approached by several manufacturers to propose contracts for producing automotive air conditioning parts and other components, indicating a clear growth potential in the OEM business, with high growth opportunities as the industry expands again due to the global economic recovery and the gradual launch of new electric vehicle models into the market. PACO has standard international production lines ready to produce products for customers immediately without additional investment, and with few competitors in the business, it is confident in securing more OEM manufacturing contracts.

In 2022, PACO will aggressively pursue the OES business to meet diverse market demands and target groups. In addition to fulfilling existing customer orders, the company will expand its market internationally, looking to enter Malaysia and cover target customers in Asia, North America, Europe, South America, and Australia.

For the electric vehicle (EV) market, PACO has produced battery coolers, which are one of the essential components for BEV and PHEV vehicles. Currently, PACO has produced battery coolers for Tesla, the world's number one electric vehicle brand, for the Tesla Model X and Tesla 3, as well as for Plug-in Hybrid vehicles from BMW Series 3 and Series 5 (current models G20 and G30), which are highly popular globally. PACO is the first Thai manufacturer of replacement automotive parts to enter the battery cooler market, both for exports and domestic sales, as the government prepares to implement measures to stimulate the electric vehicle market, which is expected to help the automotive industry in Thailand recover. Furthermore, if the COVID-19 pandemic situation improves, it will contribute to the global automotive industry's recovery. The company remains committed to continuously developing and producing new products to meet diverse market demands,” Mr. Somchai concluded.