Tuntex Textile (Thailand) Co., Ltd. (TTT) announced it has cut product outputs and jobs by ten per cent in a move to abate jump in operating costs, hurt by higher oil prices.

Solan Suthipongkanasai, MD of Tuntex, a manufacturer of polyester weaving fabric, said the company will continue to reduce product outputs by ten per cent from its current capacity of 700 tons per day.

He said the process is necessary due to lower profit margin in polyester business as crude oil price hikes, which reported swung up to $83 a barrel recently.

Together, Tuntex will also begin to continue to lay off its staffs from 800 last year to 160 this year.

“We cannot control impacts from the outside factors,” said Solan, referring a continuous increase in crude oil prices. “We cannot close factory either, while we have to keep all the machines running to cover costs.”

Solan said the manufacturing processes of polyester fabric is different from the textile industry, which not allows manufacturers to close particular production lines when material prices surge, leaving it in disadvantage position in negotiating with buyers.

Tuntex, filed for a financial rehabilitation program with Bangkok Bank in 2003 to restructure its long term debt of 3.5 billion baht and current liability of 600 million baht, said it has no problem in raising liquidity for current operation activities despite of output cut. However, it still posted net losses in the first and second quarterly report.

Tuntex hope to see turnover between 800 million baht and 900 million baht this year compared with last year 3 billion baht.

Solan said the company is in talk with a couple of potential partners in bid to diversify its main product to the manufacturing of plastic bottles and resins.

1. hey bro, this is nick from the message board for this theme. Just thought I’d let you know that your clocks are wrong. I live in NY, it is 8:57, and on your clock it shows 11:57. The one labled Los Angeles should be labled New York, and the time difference in LA means that the one labled London should be Los Angeles… I’m not sure about Tokyo or London though… Just thought I would lend you a hand

   Posted by Nick | October 12, 2007, 2:59 am