With the RM100-million ($24.5 million) investment, the local unit is expected to become the second largest factory of the Malaysian company.
According to Top Glove, the plant will be built on an industrial plot in Vietnam, on a total area of over 20 acres. It is projected to be operational by the second quarter of 2020, with 40 production lines and a capacity of up to four billion pieces a year.
Top Glove now operates 40 factories in Asia, including 35 in Malaysia, four in Thailand and one in China. It has 648 glove production lines in total, with a capacity of 60.5 billion pieces a year. Top Glove has over 2,000 customers worldwide and exports to more than 195 countries.y in
Last year, the company posted $1 billion in revenue and nearly $106 million in profit.
In an interview with Japan’s Nikkei Asian Review, Top Glove executive chairman and founder Lim Wee Chai said that the decision to open a factory in Vietnam was not an attempt to reduce its reliance on China amid protracted trade tensions between Washington and Beijing.
“We plan to build at least one to two new factories every year and also remain open to mergers and acquisitions and joint venture opportunities in related businesses,” Lim told Nikkei, adding that almost $100 million is earmarked every year for expansion and automation.
Last December, Top Glove announced the establishment of its subsidiary Top Glove Vietnam Company Ltd., headquartered in Binh Duong province, to manufacture vinyl gloves and other products. Top Glove Vietnam has a registered chartered capital of VND136.7 billion ($5.94 million).
Top Glove’s expansion to Vietnam instead of China was said to be its strategy to tap into the potential vinyl glove market in the country as well as leverage the cheaper cost of production compared to China.