(Coowor news) On June 5, 2017, the first overseas factory of Jintian Copper pipe laid the foundation stone in Longjiang Industrial Park in Vietnam,accelerating the expansion of the company's market share in Southeast Asia.
In April,2018, Daikin Industry Co., Ltd. plans to build a newly-built household air conditioner factory in Vietnam with an annual production capacity of 500,000 units and further increase production capacity to 1 million units by 2020.
Earlier time, well-known international companies also set up factories in Vietnam，such as LG, Samsung, Carrier, Haier, TCL, Hailiang, Moon Group and Midea.
In recent years, the world's leading refrigeration companies have invested and set up factories in Vietnam, Vietnam's air-conditioning manufacturing industry has also been rapid development. Why do companies want to look here?
First, political stability and rapid economic growth
In recent years, Vietnam has maintained stable domestic politics and sustained rapid economic growth. At the same time, it is trying its best to carry out the policy of reform and opening up. The investment environment has been continuously optimized, attracting many foreign investments. According to statistics from Vietnam's statistics bureau, Vietnam's economic growth in the first nine months of 2017 was 6.41%, of which 5.15% in the first quarter, 6.28% in the second quarter and 7.46% in the third quarter. Vietnamese economists predict that if the current growth rate is to be maintained, Vietnam is expected to achieve the target of 6.7% of the annual economic growth set for the whole year.In the meantime, the total amount of foreign investment attracted by the government in the first nine months reached 25.48 billion U.S. dollars (exceeding the year of 2016), an increase of 34.3% over the same period of last year.
Second, the huge population and strategic location
Vietnam has a land area of 330,000 square kilometers and a narrow territory. It borders China on the north, borders Laos and Cambodia on the west, faces the South China Sea on the east and south, and faces the countries of Malaysia, Singapore, Indonesia, the Philippines and Thailand,which has strong radiation influence on neighboring countries. With a population of 92.7 million (2016), Vietnam has a low average wage and provides a large amount of workforce required by the factory, which is one of the reasons that many factories are attracted to invest in Vietnam.
Third，the rapid economic development led to the rapid development of the real estate industry
In recent years, with the rapid economic development in Vietnam, the real estate industry has witnessed rapid development.The whole of Vietnam, like China around the year 2000, is full of construction sites. People think exaggeration is that the building construction exhibition in Vietnam held eight times a year, which is unique in the world, but also fully illustrates the rapid development of the real estate industry.
The rapid development of real estate has spawned a huge market demand for air conditioning and refrigeration industry. In the Vietnam air conditioner market, the average penetration rate of home air conditioners is 4%. At present, in the urban area, this figure is more than 10%, which shows that the market prospect is very impressive as the income of Vietnamese people keeps growing. As an important commercial center in southern Vietnam, Ho Chi Minh City, home air conditioner market accounted for about 30% of the country.
In 2017, the refrigeration exhibition in Vietnam attracted the active participation of global refrigeration manufacturers, resulting in a serious shortage of booths. Both of them wanted to quickly enter the Vietnam market through the exhibition.
Fourth，Vietnam is constantly expanding its opening up to the outside world
In recent years, Vietnam has continuously expanded its policy of opening up to the outside world and created good international trade opportunities for its manufacturing industry and has become the largest country to sign free trade agreements in Asia.In particular, the Vietnam-EU Free Trade Zone will implemente in 2019,which has created favorable conditions for the expansion of Vietnam's exports.
I believe in the near future, Vietnam will become an important production base of air conditioners in the world. However, due to the imperfect industrial chain, Vietnam will create excellent trade opportunities for air conditioner parts enterprises in China.
