The LEGO Group has confirmed that it has opened its $1-billion manufacturing facility in Binh Duong Province, Vietnam. This is the second factory to open in Asia, after LEGO first launched the facility in Jiaxing, China in 2016.
The new manufacturing hub will further help diversify The LEGO Group’s industrial base. This new manufacturing hub is part of LEGO’s broader strategy to strengthen its presence in Asia and diversify its production capabilities. Carsten Rasmussen, COO of the LEGO Group said:
I am extremely proud of our environmental sustainability progress in Vietnam, strengthening our positive impact locally while supporting our global ambitions. The use of battery storage solutions and power purchase agreements to increase renewable energy is not just a first for the LEGO Group but among the first for any company in Vietnam.
Carsten Rasmussen, COO of the LEGO Group
As early as 2011, The LEGO Group reported that 72% of its sales came from North America and Western Europe, a trend that contributed to the company’s decision to expand manufacturing in Asia over the next decade.
As a result, the LEGO Group has launched six international facilities. In 2015, the company expanded in Singapore, where its office now operates with 400 employees.
The expansion in Asia came several years after, in 2004, The LEGO Group nearly collapsed, but a strategic review allowed it to secure a stronger business foothold in its traditional as well as emerging markets.
While The LEGO Group has largely benefited from global expansion, it has still been affected by broader economic conditions, including US tariffs on countries with trade deficits and geopolitical tensions, such as the dispute over Greenland.
The LEGO Group has recently dropped diversity terms from its 2024 sustainability statement, sparking discussions about the potential influence of external political pressures, including from the United States.
The LEGO Group has remained sustainable in areas that it considers to be crucial for its business strategy, nevertheless. The Vietnamese facility will run on 100% renewable energy by 2026, aligning with both consumer and business expectations.
The company is also looking to cut oil use in its brick production over the next decade, by 2032, but this comes at a cost for the time being. The company is reporting as much as a 70% increase in the cost of production for using certified renewable resin.
Nevertheless, The LEGO Group is plowing ahead with its ambitious plan. In Vietnam, the new manufacturing facility will have 12,400 solar panels and battery storage units. The LEGO Group also recently reported that it had successfully reduced global factory water consumption to 753,711 m³ in 2024, an overall decrease of 56,000 m³ compared to 2023.
The company has acknowledged that some of its factories still struggled to achieve their ambitious environmental targets, but that they were nevertheless determined to succeed.