First-ever Vietnamese supplier for Samsung gets license for $71mn project
A Vietnamese supplier has finally qualified to join the production supply chain of Samsung, and has been licensed to develop a multibillion-dollar project to make the best use of the opportunity.
On January 7, Minh Nguyen Co. received the license investment for a VND16 trillion (US$71 million) project at the Saigon Hi-Tech Park (SHTP) in Ho Chi Minh City, where it will make components for a Samsung electronics production complex located in the same venue.
The R&D and hi-tech production complex of Minh Nguyen Co., spanning more than four hectares at the city’s hi-tech hub, is capable of producing at least 20 million spare parts a year.
The facility, named Phuoc Thanh, will use 100 percent imported equipment and machinery for production, and boasts an automation rate of at least 70 percent, according to the developer.
Le Hoai Quoc, head of the management board of SHTP, said Minh Nguyen Co. is considered the first-ever local supplier to directly take part in the production chain of Samsung.
Minh Nguyen plans to have the facility operational in the second quarter of this year, coinciding with the launch of the first phase of operation of Samsung’s screen-making project at the SHTP.
The Samsung project, breaking ground in May 2015, will focus on research and development and the production of high-end TV products such as SUHD TVs, Smart TVs and LED TVs, besides other consumer electronics products, during its first phase of operation.
The project was initially worth $1.4 billion before Samsung announced an additional $600 million investment in December 2015.
Samsung has pledged more than $12 billion of investment in Vietnam and currently has operations across the country, mostly in Vinh Phuc Province and Bac Ninh Province in the north.
But few local firms are able to qualify as component suppliers for the South Korean giant since they fail to meet its strict requirements.
Minh Nguyen Co. is among the first three businesses to receive an investment license from the SHTP in 2016.
The other firms are Malaysia’s United More SDN and Vietnam’s IDS –Hi-Tech Co.
The Malaysian firm is licensed to develop the $21 million Aureumaex Precision Plastics Vietnam project to make plastic covers and frames for smart TVs. The project is also meant to supply components to the Samsung display facility.
In the meantime, the IDS – Hi-Tech Co. will set up a VND150 billion ($6.7 million) complex of office buildings and other amenities to serve its existing business at the hi-tech park.
The SHTP management has thus far licensed six Samsung suppliers, with a total investment of $274 million, according to The Saigon Times Online.