In recent years, as more and more Chinese manufacturing enterprises have set up factories in Vietnam, many raw material enterprises have also begun to make layouts in Vietnam. Chinese modified plastics enterprises are no exception. Today, I will introduce several enterprises that have made layouts in Vietnam. Before reading this article, you can scan the QR code to join the WeChat group for Vietnam's manufacturing industry.
(I) Reasons for Chinese manufacturing enterprises to choose to set up production bases in Vietnam
-
Tariff advantages: Vietnam has signed free trade agreements with many countries and regions (including the United States and the European Union). Products exported from Vietnam to these markets enjoy lower tariffs. This makes production in Vietnam more cost-effective for entering specific markets.
-
Labor resources: Vietnam has abundant labor resources, and the labor cost is relatively low. This is very attractive for labor-intensive manufacturing industries and can effectively reduce production costs.
-
Political and economic stability: The Vietnamese government provides a relatively stable political and economic environment, which is conducive to the long-term investment and development of enterprises. The government has also adopted a series of preferential policies for foreign-funded enterprises, such as tax incentives and land use right incentives.
-
International trade environment: Vietnam maintains good trade relations with major economies in the world and is part of the ASEAN Free Trade Area. Its geographical location is superior, making it easy to access the ASEAN and even broader international markets.
-
Avoiding trade barriers: Facing the increasingly severe international trade environment, especially the uncertainties brought about by the Sino-US trade friction, many Chinese enterprises avoid the high tariffs and trade barriers imposed by the United States on Chinese products by setting up factories in Vietnam.
-
Market proximity: Vietnam not only has great market potential itself, but also is a good springboard to enter other Southeast Asian markets. This is of great significance for enterprises to expand the Southeast Asian market.
Therefore, as a production base, Vietnam is not only a place for Chinese manufacturing enterprises to seek to reduce the tariff burden of local market sales, but also a strategic choice for them to achieve cost-effectiveness and market expansion by using Vietnam's multiple advantages from a global perspective.
(II) Well-known enterprises with layouts in Vietnam
From the topographic map of Vietnam, it is mainly divided into two parts: north and south. The north mainly has the Red River Delta, which is a plain formed by the alluvial deposits of the Red River and its tributary, the Taiping River. Hanoi City is the capital of Vietnam. It is located in the northern part of Vietnam, at the northwest of the Red River Delta, on the right bank of the Red River and at the confluence of the Red River and the Thien Duc River. It is named because it is located between the Red River and the Suoi Loi River. The main provincial cities include Haiphong City, Hanoi City, Phu Tho Province, Bac Giang Province, Bac Ninh Province, Quang Ninh Province, Nam Dinh Province, Bac Ninh Province, Thai Nguyen Province, Thai Binh Province, etc.
There are companies around Hanoi and near the Red River Delta such as Panasonic, BYD Electronics, Luxshare - Precision, Foxconn, Quanta Computer, Samsung Electronics, Samsung Display, Samsung SDI, Vinfast (a local Vietnamese brand, known as the "Vietnamese Tesla"), Wolong Electric, Sanhua Intelligent Controls, Broad - Ocean , TP - Link, Kstar, and plastic - related enterprises like Wote High - Tech, Silverage, and Juzhen Technology. It can be seen that in the northern part, consumer electronics and the automotive industry are relatively concentrated.
In southern Vietnam, it's mainly Ho Chi Minh City and the Mekong River Delta. The Mekong River originates from Qinghai in China and is called the Lancang River in China. After flowing out of Yunnan, it passes through Myanmar, Laos, Thailand, and Cambodia and then flows into the South China Sea in southern Vietnam. The alluvial plain formed by the lower reaches of the Mekong River and its nine tributaries when flowing into the South China Sea is called the Mekong River Delta. It's the largest plain in Vietnam, with an area of about 44,000 square kilometers (one - fifth of which belongs to Cambodia). The average altitude is less than 2 meters, and there are many rivers and swamps.
In the south, the home appliance, footwear, and textile industries are relatively concentrated. In 2023, the revenue of Vietnam's home appliance market reached 8.2 billion U.S. dollars, and the average expenditure of each household on such products is about 2,520 yuan. With the rising consumption demand of residents and the development of home appliances towards intelligence and lightweight, modified plastics are widely used in accessories such as blades, exterior decorations, and casings of home appliances to meet the needs of lightweight and safety. Therefore, the application ratio of low-cost plastic modification technology in this industry is expected to increase. In the future, the home appliance industry will become one of the important growth points for the development of Vietnam's modified plastics industry. The Jinfa Technology Vietnam factory is located in Dong Nai Province in southern Vietnam. Here are home appliance manufacturers such as Vietnam Haier (AQUA), TCL, Midea, Samsung Electronics, Sharp, Supor, etc. There are also companies such as Schneider, Chint Electric, MTC, BOE, HKC, CPT Optronics all in southern Vietnam. In addition, there are Pou Chen shoe factories, and shoe enterprises such as Adidas, Nike, and Pou Chen Industries. The main provinces and cities are Ho Chi Minh City, Ba Ria - Vung Tau Province, Binh Duong Province, Tay Ninh Province, Long An Province, etc.
(III) Well-known enterprises with layouts in Vietnam
Aibang has specially sorted out the layouts of Chinese modified plastics enterprises in Vietnam, including Kingfa Technology, Silver Age Sci-Tech, Wote High-Tech, Juzhen Technology, Polyrocks Chemical. Most of them have been put into production.
1: Kingfa Technology (Dong Nai Province in the south)
The modified plastics production base of Kingfa Technology in Vietnam is located in Dong Nai Province. The factory covers an area of 14 hectares. The planned total production capacity of modified plastics is expected to reach 600,000 tons per year. The commissioning ceremony was held in August this year. Among them, 60,000 tons per year was originally planned to be completed in December 2024.
It is reported that the Kingfa Vietnam base mainly focuses on modified plastics of multiple categories such as modified PP, ABS, PBT, and PC. The downstream industries mainly covering Southeast Asia and surrounding regions include: automobiles, home appliances, electronic and electrical, OA, toys, etc. In addition, Kingfa has established extensive cooperative relationships with well-known enterprises such as Samsung, Schneider, Panasonic, and Midea. The business fields cover transportation, electronic and electrical, etc.
Kingfa stated that the commissioning of the Vietnam base is a key measure for Kingfa Technology to advance the internationalization process. The company's overseas layout mainly involves the modified plastics related business in the "1438" strategy. Among them, "8" refers to the modified plastics sector. To achieve an income of 80 billion yuan. Last year, Kingfa's income from modified plastics was close to 40% of the long-term goal.
2: Silverage (Thai Binh Province)
The Vietnam base of Silverage is located in the Gialai Industrial Park, Thai Binh Province, Vietnam, covering an area of 20,000 square meters. At present, the annual production capacity of modified engineering plastics is 25,000 tons. It mainly produces high-performance modified engineering plastics (PP, PC, ABS, PC/ABS, PA), modified PVC (PVC, PVC/ABS), thermoplastic elastomers (TPE, TPR), halogen-free PP flame retardants and LED intelligent lighting materials.
Intelligent lighting business
Intelligent light strips: The annual production capacity of Chinese factories reaches 50 million meters, and the annual production capacity of Vietnamese factories reaches 5 million meters.
Atmosphere light strings: The annual production capacity of Chinese factories reaches 800,000 sets, and the annual production capacity of Vietnamese factories reaches 700,000 sets.
Intelligent lamps: The annual production capacity of Chinese factories reaches 20 million sets.
3: WOTE (Haiphong City in the north)
Due to business development and the need for a global industrial layout, and to meet the order demands of overseas customers, WOTE established its Vietnam branch in 2023 to carry out research and development, production, and processing of modified materials. According to the announcement of WOTE in October 2023, WOTE Vietnam has completed all inspection and acceptance procedures of local government departments and officially entered the mass production stage.
-
Changzhou Aozhi Polymer Group Co., LTD., a subsidiary of Polyrocks Chemical Co., Ltd. (Ho Chi Minh City)
Polyrocks Chemical's PS diffusion plate cooperates with South Korea's Samsung Electronics and South Korea's LGE. To cooperate with the global manufacturing layout of Samsung Electronics, the company established Vietnam Aozhi in Vietnam in January 2020 to serve the subsidiaries of Samsung Electronics in Vietnam with better products and faster speed.
In June 2023, in response to investors' questions, Polyrocks Chemical responded that the company's overseas markets mainly include phosphorus chemical industry, diffusion plate, light guide plate and lighting industry. The phosphorus chemical business was greatly affected by tariffs, and the export volume decreased significantly. The diffusion plate and light guide plate business was less affected. To meet the origin requirements of customers, the Vietnam factory has been officially put into production and will not have an adverse impact on sales. The lighting industry has a high market share. The company will use the existing customer base to implement a product horizontal expansion strategy.
5: Juzhen Technology (Haiphong City in the north)
Jiangxi Juzhen Technology Development Co., Ltd. is located in Chating Economic Development Zone, Shangrao, Jiangxi. Established in 2018, it is a private enterprise specializing in the research, development, production and sales of special engineering plastics. Its main products include modified polyphenylene sulfide (PPS), modified polyphenylene ether (PPO), modified high-temperature nylon (PPA), etc. Its Vietnam factory is located in Haiphong City in the north and has been put into production.
SUMMARY
In general, the industry in southern Vietnam is mature, while the northern part has great potential for development. China's exports to Vietnam have formed an export of industrial chains. The export of plastic raw materials and equipment and machinery supporting facilities is particularly active in trade and investment in Vietnam, accounting for 90% of the exports of the plastic industrial chain. Traditional fields have entered white-hot competition, and the imitation and learning ability of local Vietnamese enterprises has also greatly improved. High-tech materials and high-energy-efficiency equipment are important growth points in the future.
Chinese enterprises go overseas in groups to form a scale effect, avoid taking the same repetitive paths and making the same mistakes. Mutual support and common development is a cooperation model worth exploring. After Chinese products go global, they must truly understand the local market and market demands.
They cannot stay in price competition but must engage in real marketing and brand value creation. For more convenient communication among everyone, Aibang has established Vietnam Manufacturing WeChat Groups. Enterprises in Vietnam and those about to go to Vietnam are welcome to join. At the same time, overseas-related service providers are also welcome to join.
原文始发于微信公众号（艾邦高分子）：The Layout of Chinese Modified Plastics Enterprises in Vietnam