By Kacha Panyaroj, Country Manager for Thailand, Hexagon Manufacturing Intelligence

Thailand’s manufacturing sector is at an important juncture, poised for strategic evolution. Finance Minister Pichai Chunhavajira’s recent concerns over the slowing GDP growth rate—down to 0.8% in Q2 2024—and declining export competitiveness highlight the need for a renewed focus on long-term economic growth.

The manufacturing industry, which makes up 27% of Thailand’s GDP and provides jobs for over 6.26 million people, plays a crucial role in shaping this future. The government’s Thailand 4.0 initiative envisions a shift toward a high-tech, innovative economy, with emphasis on sectors like electric vehicles, smart electronics, and biotechnology. However, accelerating progress in these areas is essential to remain competitive in the region.

This economic imperative aligns perfectly with our environmental commitments. With Thailand pledging to reduce greenhouse gas emissions by 30% by 2030, sustainable manufacturing emerges not just as an environmental responsibility but as a strategic necessity for our future competitiveness. The convergence of these economic and environmental imperatives presents a unique opportunity to reimagine Thailand’s industrial landscape.

Why is sustainable manufacturing essential?

In today’s global economy, sustainable manufacturing represents more than environmental stewardship – it’s a competitive imperative. As major economies and multinational corporations increasingly prioritise green supply chains, Thailand’s industrial sector must evolve to maintain its competitive edge while meeting our national commitment to reduce greenhouse gas emissions by 30% by 2030.

A diverse industrial landscape offers compelling opportunities for this transformation. Thailand’s electronics sector, as the world’s second-largest producer of hard disk drives, stands ready for sustainable innovation. The chemicals and petrochemicals industry, contributing 5% to GDP, faces the critical challenge of reducing its environmental footprint while maintaining productivity.

Perhaps most promising is our burgeoning electric vehicle sector, which aims to produce 1.2 million EVs by 2036 – a goal that perfectly aligns with our sustainability objectives.

Hexagon’s role in enabling sustainable manufacturing

Hexagon is driving this sustainable manufacturing revolution through several key initiatives:

• The Sixth Sense programme: An open innovation platform scaling startups to solve sustainability challenges across industries
• Global rainforest conservation: Partnership with Cool Earth supporting climate action through carbon sink environments
• Strategic partnerships: Global collaboration with NVIDIA, AWS, Microsoft, and Sony to deliver industrial digital twin solutions
• Community engagement: The Hexagon Cares programme encouraging employee volunteering and local community support

Smart manufacturing solutions provide automotive firms with the agility to navigate complexity while maximising growth and efficiency. Digital twin technology, a cornerstone of our approach, has reduced product development time by up to 50% and cut costs by 10%. Data shows organisations achieving an average 16% improvement in sustainability metrics through digital twins.

Predictive maintenance, powered by AI and machine learning, helps forecast equipment failures before they occur, reducing downtime and extending machinery lifespan while contributing to resource conservation.

Overcoming challenges in Thailand and Hexagon’s commitment

The transition to sustainable manufacturing faces challenges including initial technology investment costs, workforce upskilling needs, and integration of new systems with legacy equipment. However, these challenges present opportunities for innovation and collaboration.

Hexagon supports Thailand’s transition through local talent development, university partnerships, and collaboration with the Eastern Economic Corridor (EEC). These initiatives aim to establish the region as a leading hub for advanced and sustainable manufacturing technologies.

The government’s Thailand 4.0 initiative, coupled with the Bio-Circular-Green (BCG) Economic Model, provides a strong foundation for this transition. The benefits extend beyond environmental protection – sustainable manufacturing enhances Thailand’s global competitiveness, attracts foreign investment, and creates high-skilled jobs. With the global smart manufacturing market projected to reach US$540 billion by 2025, opportunities abound for Thai businesses.

Thailand can transform its manufacturing sector through innovative technologies, committed partners, and a shared vision for sustainability. As we move forward, collaboration between manufacturers, policymakers, and technology providers will be crucial in building a greener, more innovative future.

The time for action is now, and Hexagon Manufacturing Intelligence stands ready to support Thailand in this transformative journey.