Monday July 16, 2012
VS Industry beefs up Indonesia ops
By ZAZALI MUSA
It plans to invest RM47.8mil in second factory to strengthen position in EMS
JOHOR BARU: VS Industry Bhd, an electronics manufacturing services (EMS) provider, is investing US$15mil (RM47.8mil) this year to set up its second factory in Indonesia.
Managing director Gan Sem Yam said that works on the new factory would start soon and was scheduled for completion in the second half of 2013.
He said the second Indonesian factory would further strengthen the company's position as a leading EMS provider in that country.
“The new factory will produce sustainable energy storage fuse boxes for our new client, an American multinational corporation (MNC),” Gan told StarBiz.
He said the storage fuse boxes infused with specially formulated chemicals would be installed at the electrical transmission towers as a back-up system to produce electricity in the event of blackout.
Gan said the new 200,000-sq-ft factory on a 2.5ha site in the Jababekas Cikarang industrial area, Bekasi would be more than three times bigger the first, which measures 60,000 sq ft.
The company's first Indonesia factory, which comes under PT VS Technology Indonesian, is involved in surface mounting technology manufacturing activities.
He said the company would employ between 1,500 and 1,800 workers for its second Indonesian plant. The first plant has 800 workers.
Gan said unlike in Malaysia where manufacturers had problems hiring locals to work as production workers, it was much easier getting Indonesians to work at factories.
“There are many Indonesians who had worked in factories in Malaysia; hence these semi-skilled people are sought after by many MNCs in Indonesia,” he said.
Gan expects the second Indonesian factory would position the company as an integrated EMS provider and better serve its existing clients in Indonesia while attracting new ones.
He said Indonesia offered good-long term prospects for the company due to its commendable growth despite the unfavourable economic scenario.
VS Industry is one of the biggest and fully integrated EMS providers in Malaysia and notched up to 32nd in the Global Top 50 EMS providers in 2011, from 50th position in 2010.
It has nine manufacturing facilities in Johor, China and Indonesia employing over 10,600 people and serves MNCs from Europe, Japan and the United States.
On the local front, Gan said the company would invest RM7mil in a 50,000-sq-ft warehousing facilities opposite its existing factory at the Murni industrial park here by the end of the year. The warehousing facilities are expected to be ready by mid-2013.
He said the company also had plans for a new factory on a 4.04ha site here by next year and the project was slated for completion towards the end of 2014.
“We are still mulling over the cost of the project, and the proposed new facility in Senai is a preparation for us to cater to new clients,” Gan said.