Lectra Vietnam is based in Ho Chi Minh City and will help accelerate the company’s growth in Asia.
The Paris-based Lectra has been present in the Southeast Asian nation for more than 20 years and was represented by its agent, Ly Sinh Cong Trading Service Co., for the past 12 years. The new subsidiary will take over LSC’s team and assets.
“Thanks to 5.5 percent growth in the first quarter of 2016, Vietnam is one of Southeast Asia’s most dynamic economies,” said Daniel Harari, Lectra’s chief executive officer. “It is a top choice for manufacturers who focus on production costs and brands seeking to diversify supplies. The Trans-Pacific Partnership agreement signed in February will reinforce the attractiveness of the country, where Lectra has many customers, including very large Asian companies.”
The 12-nation TPP pact is pending ratification by the signatory countries, including the U.S., where its passage in Congress is uncertain.
“Lectra Vietnam’s objective is to help Vietnamese companies implement Lectra’s technologies that have demonstrated their worth in Asia and across the globe, and to accompany locally established foreign groups in the country,” said Yves Delhaye, managing director for Asean, Australia, South Korea India. “This opening will boost Lectra’s expansion in Southeast Asia and reinforce synergy in sales with the company’s other subsidiaries in the region.”
The apparel industry is especially vibrant in Vietnam, Lectra noted. Clothing exports reached $21 billion in 2014 and should grow about 8 percent to reach $29.5 billion in 2016, the company said, with nearly a third from local actors. Of the 6,000 textile and apparel companies, a large number are owned by Chinese, Hong Kong, South Korean, Japanese and Taiwanese companies operating out of Vietnam to take advantage of lower manufacturing costs, it noted.
“Thanks to 20 years of experience in Vietnam, Lectra understands the local industry’s fundamentals,” Delhaye added. “Several of our Chinese and South Korean apparel customers manufacture a portion of their production in Vietnam. They are very interested in innovative solutions to improve the quality of their products, the efficiency of their operations and the productivity of their factories.”
Lectra offers systems specific to each market that enable customers to automate and optimize product design, development and manufacturing. Lectra registered revenues of $264 million in 2015.