The American company SEKO Logistics, which opened its office in Vietnam on Wednesday, has more than 300,000 square meters of warehousing space, 350 container tractors and 150 trucks.
The company sees potential for logistics growth in Vietnam where the supply of goods is abundant but transport at competitive prices is a major challenge, said Anthony Barnes, CEO of the company’s Asia-Pacific division.
This year, several other logistics companies have also expanded their business or announced plans to invest more.
DHL Express announced last week that it would invest in a new gateway project near Noi Bai International Airport in Hanoi.
The new facility, which is expected to be fully operational in early 2023, will have a total usage space of 4,500 m², twice as much as the company’s old one.
It will be equipped with an automated warehouse, smart building and energy-efficient solutions in line with the company’s commitment to zero all global logistics-related emissions by 2050.
Imex Pan Pacific Group, which has brought global brands like Burger King and Calvin Klein to Vietnam, told the HCMC government that it wants to develop a logistics hub in Thu Duc City alongside the launch of its airline, IPP Air Cargo.
MSC Vietnam wants to build a transshipment port in the coastal district of Can Gio in HCMC.
Vietnam’s growing trade is the reason for these plans.
It jumped 22.6% in 2021 to $668.5 billion despite supply chain disruptions caused by Covid-19.
More U.S. companies are setting up factories or sourcing offices in Vietnam amid expanding bilateral trade, said Linh Le, CEO of Seko Logistics Vietnam.
The United States was Vietnam’s biggest market last year, with two-way trade hitting $111 billion after a 23 percent increase from 2020.
“Vietnam is also seen as one of the countries that can be an alternative manufacturing hub to China,” he said, adding that the company expects strong growth in foreign investment in Vietnam.
Bernardo Bautista, DHL Express country manager for Vietnam, said the country is showing a strong recovery with growing trade, which is why his company recently upgraded cargo capacity on its Hanoi – Hong Kong and HCMC – routes. United States.
However, the logistics sector is expected to face challenges such as shortage of containers and rising costs as Vietnamese exporters depend on foreign shipping companies.
Vo Quan Huy, CEO of agricultural company Huy Long An, said the cost of shipping a container of bananas from Ecuador to China is the same as that from Vietnam to China, at $7,000.
The Vietnam Logistics Association said the country should have its own fleet of ships to reduce its dependence on foreign companies.
Some Vietnamese companies are trying to fill the shortages.
Steelmaker Hoa Phat is building a container manufacturing plant in the south, while Hai An Transport and Stevedoring has set up a company to buy and operate ships to and from Southeast Asia and China.
Last year, Vietnam National Shipping Lines established a freight route linking Vietnam with Malaysia and India.