Toyota opens seat cover factory in Laos
Toyota opens seat cover factory in Laos
Toyota has begun manufacturing car seat covers in Laos to supply its vehicle production bases in the region.
Toyota Boshoku Corporation, which established the Toyota interior components production factory in the Savannakhet-Xeno Special Economic Zone in Laos last year, announced last week that the US$5.6 million facility had begun commercial production.
The fac tory employs 180 people in central Laos and is expected to produce around 200,000 seat covers per year, according to a press release from the company.
The interior components will be supplied to Toyota vehicle production bases in the region, mainly in Thailand.
Among the reasons Toyota selected La os as the location for the new factory are the country's political stability, affordable labour and geographic location in the middle of the region.
The Savannakhet Special Economic Zone is located along the East-West Economic Corridor, which makes it easier for Toyota to import raw materials and export its goods to neigbouring countries such as Thailand.
The zone also offers the Japanese investor a number of investment incentives, including tax breaks and reductions.
Good-q uality infrastructure and a stable supply of electricity and water also encouraged the company to invest in the zone, according to the press release.
Laos and Thailand share a similar culture and have similar languages, making it easier for the Thailand-based branch of the company to operate in Laos.
Laos has become increasingly attractive to foreign investors. Japanese firms are looking into expanding their production bases into Laos and other Mekong nations due to the current political uncertainty in Thailand and the rising cost of labour in China.
Nikon, one of the biggest Japanese camera makers, has also established a factory in Laos to supply spare camera parts to the region.
The Japan External Trade Organisation (JETRO), a Japanese public organisation aiming to boost external trade and foreign investment, officially opened a new office in the country in April, signalling growing Japanese investment interest.
The new office is scheduled to be fully operational in July. It is JETRO's 74th overseas base and its 10th in Southeast Asia.
The value of Japanese investment in Laos for 2013 reached US$405.7 million, an increase of almost 15 percent on the previous year, making it one of the top 10 foreign investors in Laos.
A number of Japanese firms said the biggest obstacles to investing in Laos were shortages of skilled labour, electricity and water.
vientiane times
