Apple supplier Foxconn to begin production in central Vietnam next year

By Tri Duc
Wed, May 17, 2023 | 3:20 pm GMT+7

Foxconn has joined the trend of Apple suppliers expanding in Vietnam, an emerging manufacturing hub for the global electronics industry, with a new investment of $100 million in Nghe An province.

The Dong Nam Economic Zone Authority in Nghe An recently granted an investment certificate to Foxconn Interconnect Technology Singapore Pte. Ltd. to deploy the project at WHA Industrial Zone 1 in the central province.

Foxconn is set to commence construction of the 48-hectare project in June 2023-June 2024. Between July 2024 and October 2024, the Taiwan-based giant will conduct trial runs, then enter official operation in November 2024, according to the investment certificate.

The entrance to WHA Industrial Zone 1 in Nghe An province, central Vietnam. Photo courtesy of the facility.

The entrance to WHA Industrial Zone 1 in Nghe An province, central Vietnam. Photo courtesy of the facility.

The factory’s annual capacity will include 400 million connecting cables, 94 million wireless chargers, 10 million wireless earphones, 244 million loudspeakers, and 627 million connectors.

Foxconn has obtained a lease with the industrial park for 48 hectares costing more than VND509.5 billion ($21.7 million), according to an exchange filing to the Taiwan Stock Exchange (TWSE).

In February, the tech giant signed a lease for a plot of 50 hectares in Quang Chau Industrial Park in Bac Giang province near Hanoi for around $62.5 million to expand production capacity. At Quang Chau IP, Foxconn had earlier leased 70 hectares for its facilities with registered investment capital of $773 million.

Chinese giant BYD, an Apple Inc. supplier, will invest an additional $183.7 million in its Vietnam electronics manufacturing facility in the northern province of Phu Tho's Phu Ha Industrial Park, local authorities announced last week.

The second phase of investment includes $178.2 million for manufacturing graphic adapters and electronic components with ceramic, glass, and iron components; and $5.5 million for producing batteries for tablets and smartphones. The new investment is set to begin later this month.

In the first phase, BYD's investment totaled $269 million and started operation in August 2022. In December 2021, BYD Vietnam was licensed to build tablets and optical prisms. This February, it received an adjusted license from Phu Tho officials to make chips, modules, 4G and 5G modems, and camera drones.

Also in May, Nam Dinh has granted an investment certificate for Apple supplier Quanta Computer to build a $120 million factory in the northern province, the giant's first in Vietnam and its ninth worldwide.

The plant, located in My Thuan Industrial Park, is set to manufacture 1.3 million laptop and desktop computers in 2024, 2.6 million in 2025, 3.6 million in 2026, four million in 2027, and 4.5 million in 2028. The 48-year project will enjoy incentives, including tax exemptions and lower corporate income tax, land lease and land use fees.

Inventec, a Taiwan-based supplier for Apple, is set to launch a research and development and supply chain complex at the Hanoi Southern Supporting Industrial Park (HANSSIP) in the second quarter of 2024. Inventec chairman He Daishui made the statement at a meeting with Hanoi Mayor Tran Sy Thanh in March. He urged municipal authorities to facilitate the project in terms of administrative procedures, immigration of foreign experts, and use of solar power at the factory.

Compal Electronics, a supplier for Apple, Amazon, and Dell, signed a deal to lease 40 hectares of land in Thai Binh province for its new $260 million investment in Vietnam in December 2022. It plans to put the new plant into official operation in the second quarter of 2024. The facility's annual capacity will include 2.1 million smartwatches, 70,000 cable modems, 100,000 wireless wi-fi routers, 10,000 5G network frequency modules, 1.1 million Internet of Things (IoT) devices, and 1.25 million tablets.

The iPhone is among the most popular smartphones in Vietnam. Vietnam spent $3.5 billion on importing smartphones in 2022, with iPhones accounting for the biggest portion of $1.61 billion, or 46.05% of the total, the Ministry of Industry and Trade reported. Total import expenditure on smartphones rose 10.5% year-on-year, while that of Apple's iPhones surged 30.58%.

However, in terms of market share, as of the end of 2022, Samsung topped the list with 40.4%, according to market researcher International Data Corporation. Other top brands were OPPO and Apple with 21.3% each, Vivo with 6.3%, and Xiaomi with 5.4%.

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