Nissin Electric to boost industrial parts output by 30% in Vietnam next year
HO CHI MINH CITY, NNA - Japanese electrical equipment manufacturer Nissin Electric Co. will expand its industrial parts production capacity in Vietnam by 30 percent next year to focus on large-scale products.
The company said on Tuesday it will invest about 450 million yen ($4.16 million) in the expansion project set to be completed in January 2020.
Nissin Electric is engaged mainly in the contracted manufacture of industrial equipment and parts in two Southeast Asian countries – Thailand and Vietnam – and plans to start up a plant in Myanmar next year, aiming to divide its regional operations among the three countries.
Nissin’s Vietnamese subsidiary, Nissin Electric Vietnam Co., has been operating in the Tien Son Industrial Zone in the northern province of Bac Ninh, located 30 kilometers northeast of Hanoi. Under the project, an assembly room will be newly built on the second floor of the firm’s first plant with a sheet-metal working area to be installed on the first floor.
Additionally, the subsidiary will lease a rental plant adjacent to its existing first and second plants, which have a combined floor area of 17,700 square meters. The rental plant will have a total floor area of 3,420 sq. meters.
The investment will provide for acquisition of such sheet-metal working and cutting equipment as state-of-the-art fiber laser cutters, NC turret punch presses and large-scale machining centers. Plans are also afoot to use welding robots in an effort to curtail labor costs in Vietnam.
Nissin Electric aims to boost revenue from its industrial equipment and parts manufacturing business in Southeast Asia in the year to March 2012 to 10 billion yen, of which Vietnam will account for 3 billion yen and Thailand the remaining 7 billion yen. The 3 billion yen target for Vietnam is expected to be achieved one year ahead of schedule by operating at full capacity.
There is a shift to divide the contracted manufacturing operations among the three countries with Thailand focused on “high-design, high-technology items” and Vietnam on “large-scale production items,” a Nissin spokesman told NNA. “Manual work and other processes will be transferred to the new Myanmar subsidiary.”
“There is an increase in cases of client companies shifting from China” to Southeast Asia, reflecting a simmering U.S.-China trade dispute, the spokesman said.