Bangkok - Thailand's auto parts industry is at risk of shedding 40,000 permanent jobs this year as domestic and global demand for vehicles shrinks, media reports said Wednesday.

Discussions Tuesday between the Industry Ministry and 1,600 auto parts manufacturers concluded that 20 per cent of 200,000 permanent employees in the sector were in danger of losing this jobs this year, the Bangkok Post reported.

"Subcontractors were laid off late last year, so contract employees would be the next target," said Damri Sukhotanang, permanent secretary of the Industry Ministry.

Total vehicle production in Thailand is expected to reach 70,000 units, compared with the monthly average of 120,000 units last year.

Thailand, a major hub for vehicle production in South-east Asia, is forecast to produce less than 1.1 million units this year, compared with 1.4 million last year.

"It is expected that the severe hardship will be contained to the first half of the year with the industry picking up in the latter half," said Damri. "This possible 40,000 unemployed is only the results of the first-half slump."

Vehicle and automotive parts rank as one of Thailand's top export items. The leading export sector is computer parts and components, which is facing similar slump because of declining global demand.

Seagate Technology, a leading producer of computer parts in Thailand, has announced plans to lay off at least 800 workers, and Western Digital, another major manufacturer, has announced plans to close one of its Thai factories putting 600 people out of work, media reports said. (dpa)