Japanese textile and apparel makers sets solid foothold in Vietnam

09:11 | 12/08/2019
A number of Japanese textile and apparel makers plan to expand operations in Vietnam due to labour costs and the impact of the US-China trade war.
japanese textile and apparel makers sets solid foothold in vietnam
Japanese textile and apparel makers are looking to shift production to Vietnam

Japanese textile maker Suminoe Textile Co., Ltd. will set up an electric carpet plant in Vietnam in order to take advantage of the low cost of labour, according to NNA Business News.

Once successful, it will be the company's second overseas base exporting to Japan.

The Osaka-based firm established a wholly-owned local subsidiary, Suminoe Textile Vietnam Co. Ltd., in Dong Van III Industrial Zone, 40 kilometres south of Hanoi, with the investment capital of $1.9 million.

The new company will rent a factory to produce electric heating appliances such as electric carpets and blankets, with its production capacity 30 per cent larger than that of the firm’s existing plant in China.

Electric heating appliances are one of Suminoe’s key products in functional goods business, produced overseas solely in Suzhou in the province of Jiangsu since 2003.

Suminoe, which made its first foray into overseas business in 1994 by establishing a Thai unit, now has 14 bases in seven countries, including the United States, India, and Indonesia.

Previously in mid-July, Japanese apparel maker Matsuoka Corp. released plans to build a new plant in Vietnam as part of a medium-term business strategy to lessen its reliance on China, according to NNA Business News.

Accordingly, Matsuoka will establish a wholly-owned subsidiary called Annam Matsuoka Garment Co. possibly in August to build and operate the new plant in the north-central province of Nghe An. The new plant is Matsuoka’s fourth one in Vietnam after one each in the northern provinces of Phu Tho and Bac Giang and the southern province of Binh Duong.

Like the three other plants, the new plant will make apparel on an original equipment manufacturer basis.

Matsuoka hopes to begin operations in Nghe An at an early date, however, details such as the plant’s launch date and production capacity have yet to be worked out.

Of the Hiroshima prefecture-based company’s overseas sales in the fiscal year through March this year, China accounted for about 60 per cent, Bangladesh 25 per cent, and Vietnam 10 per cent. The firm’s medium-term business plan calls for reducing its reliance on China to around 50 per cent by March 2021 by shifting its focus to Vietnam instead, at the same time avoiding rising production costs.

Matsuoka sees Vietnam as a key production base for casual apparel bound for Japan and China, adding the firm’s Bangladesh arm manufacturing innerwear and working wear.

By Ha Vy

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