The factory in Binh Duong with a scale of 1 billion USD will create a new standard for LEGO worldwide!
We had a brief chat with LEGO Group Chief Operating Officer Carsten Rasmussen just hours before he was due to board his flight back to Denmark. He has just spent 3 days working in Vietnam, meeting the Government, visiting employees in Ho Chi Minh City and visiting the area preparing to start the factory in Binh Duong.
LEGO factory in Binh Duong is also one of the FDI investments that receive the most attention in the period of late 2021 – early 2022, from both the Government, the public, and consumers. Few people know that LEGO took a decade to explore the Southeast Asian market, but it only took 3 months to make the decision to choose Vietnam, and specifically Binh Duong to “nest”.
The investment of more than 1 billion USD for the factory in Binh Duong at the same time marks many milestones of the famous global toy brand:
– The 6th factory in the world, the 2nd in Asia;
– LEGO’s first and most sustainable carbon-neutral factory;
– Step into the Southeast Asian market;
* Taking a decade to explore, what makes LEGO believe that this is the right time to build a factory in Vietnam as well as enter the Southeast Asian market?
Our mission is to bring joy to children. The LEGO team did their research and found that across continents, the population growth rates and birth rates in the Asian region are far superior to those of older continents like Europe. Especially in Southeast Asia. This is an area full of potential and we want to bring the best, the most fun for the children here.
In the past 2 years, when LEGO has been searching and visiting locations for the new factory, there are many potential locations in Vietnam and Southeast Asia. But LEGO was really convinced and quickly made the decision to choose Vietnam when looking at Vietnam’s commitment, the skills of the workers, the mindset, as well as the support of the central government. – local. That commitment brings benefits to both sides, especially the common goal towards low carbon emissions and sustainable development.
* What will the roadmap of capital flow of more than 1 billion USD in 15 years look like, sir?
1 billion USD is a lot of money. The investment process is also not something that can be said on day one, day two, it needs a 10-15 year roadmap and cost plans.
Currently, we have land that is confirmed to be used to build a factory, but this area is not fixed, there is still potential for expansion. Should know how, the amount of investment can also be larger.
In terms of expected output, when we produce, we usually exceed demand.
* How is the model of a sustainable, carbon-neutral factory in Binh Duong different from previous LEGO factories?
The factory in Binh Duong will be very different from previous LEGO factories around the world, as we emphasize sustainable development and carbon neutrality.
The number one criterion is to be carbon neutral, not to emit more CO2. Our system will also help save water up to 40%. Regarding waste disposal, LEGO will not use the landfill method. This is not a story that can be told and handled in a day or two, we are still looking for partnerships to find a solution to this problem.
The new LEGO factory will have rooftop solar panels installed and VSIP will build a solar project on LEGO’s behalf. From there, this solar network will produce enough renewable energy to meet 100% of the plant’s annual requirements.
Besides, safety comes first.
We very much hope that the factory in Binh Duong can set a new, higher standard, as a model through which to demonstrate LEGO innovation.
However, to be honest, we do not consider ourselves to be leading experts in the field of sustainable development. We are also people who want to learn. Through talking with the Deputy Prime Minister and leaders of Binh Duong province, with the commitments they made, I think this is the effort of both sides. Currently, Binh Duong factory only has a few procedures left, the rest of the parties have shown their commitment to pursue this sustainable model.
LEGO Group Operations Director – Mr. Carsten Rasmussen
* This is LEGO’s 2nd factory in Asia. What are the products produced at this factory and to which markets? At the same time, cheap toy products, floating in Vietnam and Southeast Asia are now a lot. How do you compete with the wave of cheap toys?
The factory we invest in in Vietnam will operate fully, with the same technology and specifications as other factories of the group around the world.
(The COO pulled out a small LEGO model from his breast pocket as he spoke.) This can be considered a legacy, anyone who looks at it or touches it knows it is a LEGO product.
In order to manufacture such products, we must ensure a strict set of standards. And LEGO products for children, bring fun, enhance creativity for children. That is the difference, the competitive advantage of LEGO.
* Supply chain disruption is a dilemma that we have seen in the past 2 years of Covid. With the factory in Vietnam, how LEGO calculated the logistic problem. What advantages do you see in Vietnam in this field?
We have a network of factories scattered in many parts of the world. The Covid epidemic is something no one wants and we also hope it will never happen again. LEGO’s choice of Vietnam over another – where we already have a factory – is the solution to increase resilience. All factories use the same technology, so if there is a break in the supply chain, it will not affect much. In other words, this is also a factory for us to be self-sufficient and resilient to fluctuations.
* Information that LEGO invested in a factory of more than 1 billion USD in Vietnam received a lot of positive feedback from readers and consumers. Does LEGO plan to open flagship stores in Vietnam or other countries in the region?
As a major brand, we have researched and found promising commercial potential. In the past 2 days of exchange, LEGO also continued to receive many positive signals.
Regarding the flagship store, we don’t have any plans for this at the moment, but maybe after the factory goes into operation, there will be new plans. We look forward to that too.
*Thank you for sharing!
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