KPN Motor Car Co says its ambitious plan to list on the Stock Exchange of Thailand is still on track despite unfavourable conditions including a slow economic recovery.
Founder Keattisak Keeratiyakornsakul said the company’s two main businesses, assembly and distribution of taxis, and tyre distribution, have performed strongly with about 1 billion baht in combined revenue.
Mr Keattisak, who is also managing director, said KPN Motor is conducting a feasibility study to offer hire-purchase loans to taxi drivers who want to buy their own vehicles.
He said at least four financial companies have offered to serve as financial advisers and offer loans for the company to manage hire purchase, an activity that will strengthen the financial status of KPN Motor.
At present, the business of taxi-assembly and selling taxicabs has a small margin of only 3-5%, but financial services are likely to create higher profit, according to Mr Keattisak.
He said before listing the company on the bourse, KPN should operate a hire-purchase business, together with taxi assembly and tyre distribution.
The company has no connection with KPN Group Corporation, a conglomerate owned by the Narongdej family.
KPN Motor Car was formed in 2000 by Mr Keattisak as a small auto-parts trader before expanding into the wholesale trade for auto parts for Toyota.
The company later expanded into selling several tyre brands. Its distribution channels includes two outlets and an online platform.
In 2008, it started to assemble and distribute taxicabs. Since then, the company has distributed more than 5,000 units, said Mr Keattisak.
The competition in the taxi-assembly business is intense with a number of assemblers.
However, the potential remains strong thanks to the growing demand for replacement taxis in Bangkok and Greater Bangkok.
The number of taxis in the metropolitan area totalled 97,766 with 72,439 drivers as of April, according to the Land Transport Department. In 2015, new registered taxis rose by 23.1% to 9,409 units in Bangkok and Greater Bangkok.
About 10,000 taxicabs need to be replaced every year as the average lifetime of a taxicab is only nine years.
KPN’s taxicabs are sold via 25 outlets in Bangkok and vicinities, 20 of which are partnerships with Toyota dealers and gas installers. The rest are run by KPN.
Toyota’s Altis is a popular model for taxi assembly and the model sells at 800,000 to 900,000 baht a unit.
Other models from Toyota such as the Innova, Camry and Fortuner are also available.
Mr Keattisak expects to sell 1,000 taxicabs this year.
After listing on the stock market, Mr Keattisak said the company will expand into property development with its first project, a low-rise condominium on Pradit Manutham Road, scheduled to start construction in 2019.
“Urbanisation and new mass-transit routes in Greater Bangkok are positive factors for the property sector to develop both residential and commercial projects,” he said.