South Korean Kolon Industries Inc., a subsidiary of Kolon Group, will develop a $1 billion factory manufacturing airbags and industrial fabric for automobile tires in Binh Duong province, aiming to capture a larger share of the domestic and international market.
According to local media, on November 23, Kolon Industries and leaders of the Binh Duong People’s Committee signed a memorandum of understanding (MoU) to confirm the South Korean firm’s investment plan.
In the framework of the event, a representative of Kolon Industries announced a land lease contract with Investment and Industrial Development Corporation (Becamex IDC). Accordingly, Kolon Industries will rent a 42-hectare area in Becamex IDC’s expanded Bau Bang Industrial Park to construct the factory.
According to Kolon Industries’s plan, the investment capital of $1 billion will be disbursed in three phases. The first phase, with a total investment capital of $220 million, will be disbursed in the 2017-2018 period, the second phase will last until 2026 with $600 million. The $1 billion mark will be hit sometime after 2026.
Before choosing Binh Duong, Kolon Industries paid a visit in March to Ha Nam province to survey the area and find investment opportunities.
Establishing its first nylon production factory in 1957, Kolon Industries is currently expanding operations into four major business divisions, namely industrial materials, chemical, electronic materials, and fashion. The company earns approximately $100 billion in revenue each year. It currently has factories in South Korea, China, Indonesia, and Mexico.
The corporation plans to globalise its business lines in automotive materials, advanced materials, optical films, chemical and fashion production by increasing investment in high-value products.
Its parent company, Kolon Group, was licensed for a $14.1 million airbag manufacturing facility in Binh Duong province last year. The group also wanted to expand on the Vietnamese market via developing another project, probably also located in Binh Duong. The group is currently negotiating this project and forthcoming information has been scarce.