Copenhagen, DenmarkToymaker Lego acknowledged on Wednesday it plans to construct a unusual factory in Vietnam to possess up up with rapid rising seek files from for its coloured plastic bricks amongst formative years across Asia.
The privately-owned Danish firm acknowledged it’ll make investments bigger than $1 billion in the mission, which is ready to be its 2nd Asian factory after it opened one in China in 2016. Lego has performed double-digit growth in the space since 2019.
Inquire is now no longer astray to outstrip present from its Chinese language plant in the mid to long timeframe, Lego’s Chief Operations Officer Carsten Rasmussen advised Reuters.
“Exclaim in China and Asia is honorable and we can peek that over time that we can need more potential,” he acknowledged, pointing to a rising middle class and high number of births in the space as in contrast to more worn European and North American markets.
The switch is the latest in Lego’s decade-extinct job of inserting production cease to key markets, which has helped rein in costs and defend it from exterior factors.
“It presents us shorter provide time to our customers and construct us in a local to react rapidly on seek files from nonetheless it obviously also makes us more resilient,” Rasmussen acknowledged.
He added that the choice to construct in Vietnam had no longer been accelerated by latest global present chain disruptions.
This would possibly maybe also be Lego’s first carbon neutral factory as it plans to take a look at the energy consumption with photo voltaic vitality from panels on its roof and from a nearby farm.
Even though Lego peaceable makes bricks out of oil-primarily based mostly entirely plastic, it has pledged to interchange these with ones made from sustainable offers by the cessation of the last decade.
The factory, which is decided to begin production in 2024 and must make expend of as many as 4,000 contributors, would add a “necessary addition” to Lego’s annual production of roughly 100 billion bricks, Rasmussen acknowledged, declining to present more factor.
Lego, an abbreviation of “leg godt” which formula “play effectively” in Danish, is also expanding potential in Mexico, Hungary and China and including machinery at its Danish and Czech vegetation, he acknowledged.