Ecco Tannery (Thailand), a wholly-owned subsidiary of the Denmark-based shoemaker Ecco, will raise its production capacity by roughly 40 per cent this year to support the expanding footwear production of its affiliate, Ecco (Thailand).
With an investment of 100 million baht, the manufacturing output of the plant in Ayutthaya would be increased from the current 10.5 million square metres of leather per year to 14.5 million, said Bert van Heesbeen, managing director of Ecco Tannery (Thailand).
The new investment would bring the company’s total in Thailand to US$12 million, most of which was spent on construction of its manufacturing plant three years ago. Work would start in the third quarter with completion due sometime next year, he said.
Ecco (Thailand), 95 per cent owned by the Danish company, just completed a 25 per cent increase in its manufacturing volume to 3.6 million pairs a year with the target of six million a year by 2005.
Mr. van Heesbeen said 75 per cent of the tannery’s current leather output of six to seven million square metres a year was used within the group and the remainder was supplied to outside customers, Wilson and the Coach group, for making baseball gloves and bags at their factories in China and Vietnam.
Since operations started in late 2000, Mr. van Heesbeen said the company had recorded revenue growth of 30 per cent annually. It is targeting total sales this year of $25 million (1.075 billion baht).
Aside from the factory in Thailand, Ecco has tannery facilities in Portugual and Indonesia.
Speaking during a visit to the Ecco plants in Ayutthaya, Industry Minister Somsak Thepsuthin said that the ministry had been helping local tanneries find strategic partners to help upgrade their production.
Almost all tannery operations in Thailand focused on the low-end market with very few high-end producers, he said. The ministry recently announced plans to invest more than 600 million baht in a model tannery pilot project.
Original story by Nareerat Wiriyapong, Bangkok Post at