Samsung plans to expand its factory in Vietnam

4/9/2021| 15:58

Samsung is considering to expand its factory in Bac Ninh in the second half of this year to increase the production to 25 million units of the Z Fold and Z Flip per year, according to The Korean Economics Daily.

This source said, screen manufacturing unit Samsung Display has a project to expand its factory in Bac Ninh in the second half of this year, aiming to put it into full operation by the end of the year or early next year.

Experts say that once Samsung completes the expansion of this factory, the company will be able to produce 10 million units of the Z Fold and 15 million units of the Z Flip per year.

Samsung's decision to expand the factory is mainly due to high market demand.

Its third-generation foldable smartphone recorded 920,000 pre-orders in South Korea, 1.8 times more than the previous model Galaxy S21.

Pre-orders for the Z Fold and Z Flip in China are even higher, with over 1 million orders.

Sources said the number of pre-orders in the U.S. also surpassed the previous "elder" model.

"Samsung's foldable device factories are already operating at full capacity. The company has no choice but to expand its facilities," the source said.

The Korean company is likely to add three more production lines in addition to the current seven, which will allow the company to manage production volumes more flexibly.

 

Samsung plans to expand its factory in Vietnam

Samsung Vietnam factory in Bac Ninh. Photo: Samsung

Until the third generation, Samsung succeeded in producing smartphones with foldable screens.

Its first foldable phone, the Galaxy Fold, launched in 2019, sold only 500,000 units globally.

Last year, the company launched its second generation, Galaxy Z Fold 2 and Galaxy Z Flip, which also sold about 1.5 million units worldwide.

Meanwhile, with just the past two months, Samsung has produced more than 3 million units of the Galaxy Z Fold 3 and Z Flip 3 to meet the increased demand, by operating factories at full capacity of 1.5 million units per month.

Market research firm Display Supply Chain Consultants (DSCC) forecast in June that the display industry will produce 8.9 million foldable displays this year.

In August, DSCC sharply increased its forecast to 10.4 million units due to increasing demand for Samsung devices. The company's forecast figure for 2022 is 16.4 million units.

"Samsung will lead the smartphone industry, as new foldable phone models become more familiar and popular with global consumers," said Kim Ji San, head of research at Kiwoom Securities.

In Vietnam, Samsung has 6 factories and is building a research and development center. Samsung has invested more than 17.7 billion USD in Vietnam and currently has 110,000 officers and employees with export turnover worth more than 56 billion USD in 2020.

In the context of the epidemic, from January to July, Samsung still achieved a growth rate of 10% over the same period. A representative of Samsung Vietnam said that if the factory in Ho Chi Minh City returns to normal operations in the near future, this company may exceed this year's export target.

It is expected that by the end of 2022, Samsung will inaugurate a research and development center in Hanoi, contributing to the development of Vietnam's information technology industry. About 3,000 Vietnamese engineers will work here.

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