LG Electronics announced on February 17 that it invests US$300 million in Hai Phong, a port city in northern Vietnam, to build a 400,000m2-wide home appliances factory by 2020.
The electronics giant has run similar factories in Hai Phong and Hung Yen but they are rather small in size and therefore it has had difficulties increasing the production volume. With the lease periods coming to an end, the company is planning to build an additional plant and run it in connection with the two.
About 100km away from the capital city of Hanoi, Hai Phong is the third largest city in Vietnam. LG is going to manufacture refrigerators, washing machines, air conditioners and so forth in its factory in Hai Phong. “We’re setting up the new factory to secure more space and increase our production capacity, not to transfer the production base from China and other regions,” said the company.
These days, Vietnam is rapidly increasing its popularity with Korean companies as a production base thanks to cheap and plentiful workforce. In earlier this month, Samsung Electronics has decided to build its new mobile phone manufacturing factory in Thai Nguyen in northern Vietnam at an investment of at least hundreds of billions of won. Samsung is already running the world’s largest mobile phone factory in Bac Ninh, whose annual production capacity amounts to 150 million units.