The global supply chain: Lego plans to establish a $1 billion facility in Vietnam

$1 billion

Lego wants to establish a new factory in Vietnam to meet rising Asian demand.

The toymaker said it will invest over $1bn (£760m) in the facility near Ho Chi Minh City.

That plant in China opened five years ago.

Regional growth has been double-digit since 2019.

“We are very grateful for the Vietnamese government’s cooperation in helping us create our first carbon-neutral manufacturing,”

stated Lego’s COO Carsten Rasmussen

The property will be built next year, with solar panels on its roof and on a nearby farm to match its energy use.

The plant is expected to provide up to 4,000 employment over the following 15 years.

As a result of the coronavirus epidemic, organizations around the world have suffered global supply chain challenges.

So it can adapt swiftly to local consumer demand shifts, shorten the supply chain, and lessen the environmental impact of long-distance shipping.

Delays in supply chains did not prompt the business to establish the plant in Vietnam, but some experts say it can serve as a lesson to other companies facing similar challenges.

“They’re doing what we should have done years ago: hedging our bets. You need options if you see demand from a certain direction “RSR Research’s managing partner, Paula Rosenblum.

However, some global corporations with factories in Vietnam have had a difficult two years.

Some logistics experts believe Vietnam’s recent troubles may prepare it for future ones.

“Vietnam has learned a lot about balancing the risk of Covid outbreaks and maintaining manufacturing capacity,” said TMX consultant Megan Benger.

“We feel these lessons will likely serve the country well in future outbreaks,” she added.


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