German adhesive tape manufacturer to build a 55 million euro plant in Việt Nam
Tesa has recently made a public announcement that it will invest 55 million euro (US$60.3 million) in a tape adhesive plant in Việt Nam, making it the 15th production site that tesa operates worldwide besides large plants in Germany (Hamburg, Offenburg), Italy, the US, and China.
The new facility will be located on a 70,000sq.m site in DEEP C Industrial Zones, an industrial park cluster in the port city of Hải Phòng in Northern Việt Nam. Production will start in 2023 with approximately 140 employees in the first phase.
In Germany, tesa is one of the most influential brand names in production of hi-tech tape for electronics and automotive industries. This latest movement is a firm and timely step of the group to tap into the potential of the dynamic Asian adhesive tape market and build up its already strong position in this remarkable region.
The plant that tesa has been operating in Suzhou, China will reach its full capacity in 2025 despite expansion.
“The new plant in Việt Nam creates the necessary capacity to ensure our growth targets in the largest and fastest growing region,” explains Stefan Schmidt, head of tesa Supply Network, responsible for purchasing, logistics, and production at tesa worldwide.
Why Việt Nam?
“Time-to-market is especially important to us. Access to markets, fast and flexible delivery to customers and the development of local raw materials are important factors in international competition,” says Stefan.
Việt Nam offers tesa the best opportunities to shorten the way to customers and suppliers in Southeast Asia and China. Plus, a growing number of their important customers in automotive and electronics are relocating in Việt Nam.
“Location has always been one of the most unique selling points of Việt Nam when it comes to attracting FDI. Specifically, the port city of Hải Phòng has been on the radar of investors thanks to its massive upgrade of infrastructure in recent years”, said Koen Soenens, General Sales & Marketing Director at DEEP C Industrial Zones.
Being world’s 15th populous country with over 96 million people at an average age of 31.7 years old, Việt Nam is young and suitable for mass production. Notably, a significant number of new engineering, manufacturing and construction graduates is produced each year in Việt Nam.
Positive outlook for FDI recovery
The International Monetary Fund, in a report published in April, expected Việt Nam to be one among few countries with positive growth rates in 2020 despite the severe impact of the COVID-19 pandemic. In the first quarter of 2020, the country’s economic growth increased by 3.82 per cent and the manufacturing sector retained its role as economy leading driver at 7.12 per cent.
The fact that tesa decides to land their expansion in Việt Nam proves their confidence in the potential for development and sends a strong signal that FDI attraction is moving forward on a recovery path. After early success in containment of the virus and reopening of the economy, Việt Nam has emerged to be a safe destination for foreign investors.
“We are strongly convinced that the potential is far greater than before as the COVID-19 pandemic has raised a serious concern over the concentration of production in one single country,” said Hans Kerstens, Senior Sales Manager at DEEP C Industrial Zones.
In Việt Nam, tesa is also investing in sustainability: 65 per cent of the production volume will be made with solvent-free, water-based adhesives. For the plant planning, the company strives for certification according to the internationally recognised “LEED Gold Standard”. Among other things, the use of solar energy and rainwater treatment are planned.
The deal between tesa and DEEP C Industrial Zones was made partly thanks to their compatibility in sustainability vision. Tesa aspires to sustainable hi-tech tape production while DEEP C works toward realising the first eco-industrial park concept in Việt Nam with installation of solar panel on plant’s rooftop, construction of road made from plastic waste, generation of green energy.
tesa SE is one of the world’s leading manufacturers of technical adhesive tapes and self-adhesive system solutions (more than 7,000 products) for industrial and commercial clients, as well as for end users. Since 2001, tesa SE (4,926 employees) has been a fully owned affiliate of Beiersdorf AG (such as NIVEA, Eucerin, la prairie). Around three quarters of the tesa group’s sales (2019: 1,378,7 million euro) are generated by applications for various industrial sectors, such as automotive and electronics (including smartphones, tablet PCs), printing & paper, building supply as well as security concepts for effective brand and product protection. As a partner to the pharmaceutical industry, tesa also develops and produces medicated patches. Almost a quarter of the group’s sales is generated by products for end users and professional craftsmen. 300 applications make work at home and in the office easier.
DEEP C Industrial Zones is a Belgian developer and operator of an industrial zone and port infrastructure cluster in Hải Phòng City and Quảng Ninh Province – the most dynamic growing region in North Việt Nam. DEEP C has become one of the largest industrial property developers in Việt Nam with five industrial zones, forming DEEP C industrial zone cluster covering 3,400 hectares at the epicenter of the region’s manufacturing and infrastructure boom. DEEP C provides a large portfolio of products and services including industrial land and workshop/warehouse for lease, port development, and operation, utilities supply and distribution, renewable energy generation, etc. DEEP C’s goal is to grow into Việt Nam’s first eco-industrial park driven by digital technologies and innovative mindset where its clients are provided with all the tools they need for success. – VNS