Vingroup JSC, one of Vietnam’s largest real estate, tech and retail conglomerates has started construction on its Hanoi based smartphone factory. The VinSmart factory will be located in Hoa Lac Hi-Tech Park and completed in two phases. The first phase will be completed in August 2019 with a production capacity of 23 million phones a year, which will increase to 125 million units in early 2020, when the final phase is completed.
The factory will be built according to international standards for electronics and Manufacturing, will full temperature and electrostatic discharge control, humidity regulation and air quality control. VinSmart’s technology was developed in close collaboration with large tech giants such as Qualcomm, ArcSoft, DxO and Google – its design cooperatively created with a number of designers and Original Design Manufacturers.
The new factory will have 25 times the capacity of its existing plant in Haiphong, which produces 5 million units per year. The USD 33.9 million plant began producing phones in 2018 when VinSmart acquired a 51% stake in Spanish electronics manufacturer BQ. VinSmart plans to become a major player in the global smartphone market by leveraging BQ’s assets.
In March this year, VinSmart entered the European market, introducing four of its models in Spain, distributing them through 90 Media Markt stores. Media Markt is Europe’s largest retailer of consumer electronics. VinSmart is also looking to expand to France, Germany and Portugal. In May 2019, VinSmart launched the Vsmart brand and products in Myanmar. Future plans for VinGroup include investing in factories for smart products, such as smart TVs.
Vietnam is already a major hub for smartphone Manufacturing and is the second biggest exporter of smartphones in the world, after China. Global electronic giants Samsung and LG have set up operations in the country. Samsung has established its largest global Manufacturing hub in the north of Vietnam, producing 40% to 50% of the company’s global smartphone output.
Previously several local companies in Vietnam, including Vietnam’s state-owned telecom company Viettel, leading IT company FPT, and software developer BKAV have ventured into the mobile phone market with homegrown brands with limited success.
(Source: Vietnam News; Nikkei Asian Review; Vietnam Investment Review)