Fostering a Global Production Hub
Shifting Production Share from Jeonju Plant to Vietnam
KCC's global materials business is showing tangible results. By positioning the materials business as a future growth engine and developing Vietnam as a global production hub, it is leading to expanded performance.
According to the Financial Supervisory Service's electronic disclosure system on the 17th, last year KCC Vietnam Corporation (KCVN)'s materials division sales reached 34.3 billion KRW, an increase of about 82% compared to the previous year (18.8 billion KRW). Since its establishment in 2021 with sales of 1.8 billion KRW in its first year, KCVN has continued a steep growth trend, reaching 12 billion KRW in 2022.
The main materials products of KCC, such as AM (Alumina Metalizing) and DCB (Direct Copper Bonded) products, are currently produced at two bases: the domestic Jeonju plant and the Vietnam Yen Phuoc plant. AM products are used as materials for various electronic components such as vacuum circuit breakers, vacuum tubes, and high-frequency oscillators, while DCB is applied to power modules. The company is continuously shifting the production share from the Jeonju plant to Vietnam, positioning Vietnam as a global materials production base. Accordingly, the materials production capacity of the Yen Phuoc plant increased from 720 tons annually in 2023 to 932 tons last year, whereas the Jeonju plant's capacity decreased from 742 tons to 381 tons, about half, during the same period.
In particular, the Vietnam plant is the only overseas factory of KCC that produces ceramic substrates. Ceramic substrates are key components that enable high-efficiency power conversion in electric vehicle batteries and other applications. In line with the trend of global electronics companies operating assembly plants in Southeast Asia to reduce costs, KCC is also focusing on overseas market expansion. A KCC official explained, "The transfer of production capacity from the Jeonju plant will continue steadily this year as well," adding, "We will utilize Vietnam, which is emerging as a hub of the global electronics industry, as a global base for materials types."
Meanwhile, KCC is actively pursuing overseas market expansion strategies not only in materials but also in the coatings sector. The coatings division sales of the Vietnam corporation (KSV) increased by 38%, from 65.4 billion KRW in 2023 to 90 billion KRW last year. A company representative stated, "We plan to continue investing to expand production capacity at overseas plants to respond to growing global market demand and secure competitiveness."
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