THACO eyes revenue target of $1 bln in 2025

Billion-dollar strategy

While visiting THACO Chu Lai Industrial Zone at the end of March 2022, Prime Minister Pham Minh Chinh assigned THACO three essential tasks, one of them being to continue developing the mechanical industrial zone to meet foundation industries requirements.

To carry out this task, Supporting Industrial and Mechanics Corporation – THACO Industries (under THACO Group) has continued to invest in expanding its scale, improving production capacity, boosting exports, and setting a target revenue of $1 billion by 2025, of which export is $500 million.

THACO Industries factory in Chu Lai Industrial Zone. Photo by THACO Industries

THACO Industries has identified 2022 as the hinge year for establishing the foundation for a leap forward in mechanical and supporting industry business. The company has set out a comprehensive plan, from investing in core technology, and developing diversified products to digitalizing management… aiming to reach the target of $1 billion in revenue by 2025.

Do Minh Tam, General Director of THACO Industries, said: One of the limitations of Vietnam mechanical industry is that the market size is small, companies have not mastered technology, while the requirements of this industry are sophisticated technology and large investment. In order to improve production capacity and create a competitive advantage in the global supply chain, THACO Industries focuses on investing in core technology with an appropriate roadmap.

Accordingly, automobile and motorcycle components manufacturing plants are invested with modern technology lines transferred from Germany, Switzerland, Japan and Korea. In industrial equipment manufacturing plants, the company develops a system of production lines and equipment with intelligent control connection; research and manufacture laser cutting machines, robots with 3 degrees of freedom… In the production of agricultural equipment, innovative solutions are used in livestock, food processing, and microbial organic fertilizers.

Product diversification is considered a strength to improve competitiveness in domestic and export markets. THACO Industries has invested in developing a variety of strategic product groups like precision mechanical processing, auto and motorcycle spare parts, industrial and civil components, and equipment for the automobile, industry, agriculture, construction sectors.

The company focuses on developing large-sized mold processing, mechanical processing and plastic products for civil and industrial use. In particular, the semi-trailers, strategic export products, continued to be upgraded, improved configuration and diversified models, expanding export to potential markets like Japan, Australia, Korea, Canada, and ASEAN countries.

The semi-trailers, strategic export products of THACO Industries. Photo by THACO Industries

For the domestic market, THACO Industries continues to increase the quantity and value of spare parts production, becoming the supply partner for FDI enterprises, contributing to increase the localization rate of key industries, minimizing risks from supply chain disruptions due to the Covid-19 epidemic.

Sustainable development

To meet increasing market demand, from now to 2025, THACO Industries will invest in 19 new plants. In the near future 2022, four plants will enter operation, including a pressure equipment plant; molds plant; specialized agricultural equipment plant; heavy steel structure plant.

The company continues to promote the provisioning service for designing, testing material and surface treatment (zinc-electroplating, blasting, heat treatment, ED coating, powder coating).

Besides the mechanics and supporting industries production model in Chu Lai, THACO Industries is investing into two industrial zones in the north and south of Vietnam, forming a new generation of specialized industrial zone models, following innovative trends of digitization to minimize product costs, meeting the demand for mechanical components, spare parts and specialized machinery and equipment for domestic partners and exports.

Northern Industrial Zone will manufacture and supply interior – exterior parts and auxiliary for cars, motorbikes, household electronics, and mold production; Southern Industrial Zone will process mechanical products, and manufacture machinery and equipment.

Closed support and connection in production and business in the three regions of Vietnam will contribute to optimize efficiency across the value chain, reduce logistics cost, improve competitiveness and create new business opportunities, Tam said.

THACO Industries is promoting joint ventures and associations with domestic and foreign partners; connecting and creating conditions for small and medium enterprises to participate in the production chain to create a network of industry-regional linkages, deeply participate in the global supply chain, gradually form a sustainable development ecosystem of mechanics and support industries, contributing to creating resilience for the Vietnam mechanical and supporting industry.

“Saving energy in industrial production and ensuring national energy security are significant to the country’s socio-economic development. As a pioneer in developing mechanical and supporting industries with the largest scale in Vietnam, THACO Industries makes efforts to find strategic solutions to save energy, increase productivity, and supply products with high technology and outstanding technical features”, a company representative said.