Mechanical enterprises need to increase linkages

In Da Nang , the number of mechanical industry enterprises in general and supporting mechanics in particular is still small and not concentrated, which leads to slow development of the mechanical industry. Therefore, strengthening the connection between enterprises in the industry is a necessary solution at present.

Increasing business linkages to promote the development of the city's mechanical industry. In the photo: Production workers at Huynh Duc Trading - Service and Production Company Limited. Photo: M.Q

Increasing business linkages to promote the development of the city's mechanical industry. IN PHOTO: Production workers at Huynh Duc Trading - Service and Production Company Limited. Photo: MQ

Huynh Duc Trading - Service and Production Company Limited (Hoa Khanh Industrial Park (IP) expansion, Lien Chieu district) is assessed by the Department of Industry and Trade as a precision mechanical enterprise with modern scale and technology compared to the average mechanical enterprise in the city. Currently, this enterprise produces precision mechanical products such as: machine jigs, machine parts with high-tech cutting machines (computer controlled) to supply to the Central - Central Highlands market and companies from Japan, Korea, the United States...

At the end of 2021, the company invested in a project on means of transport, machinery and equipment for supporting industrial production with a total investment of more than 70.4 billion VND with 17 machines and equipment and 3 trucks. The project helps increase production capacity to 400 tons of products/year and is expected to be completed by the end of 2023. Although the production scale is large, linking and cooperating with mechanical enterprises in Da Nang is still a "gap" for the company. Mr. Lam Phung Ut, the company's CEO, said that the production chain of the mechanical industry has many stages such as processing, casting, heat treatment, etc., but the city's market is currently mainly focused on enterprises processing and manufacturing civil mechanical products, lacking medium and large-scale casting and heat treatment enterprises. To meet the product manufacturing requirements, the company had to cooperate with a heat treatment company in Ho Chi Minh City, which added to the transportation costs as well as increased production time, but the company had no other options.

Meanwhile, Ha Giang - Phuoc Tuong Mechanical Joint Stock Company (Hoa Cam Industrial Park, Cam Le District) specializes in providing technical equipment such as lifting systems, large and small cranes, tanks, bending machines, large-sized rolling machines, but its production capacity is small and has not yet mass-produced. There are not many links with mechanical enterprises in Da Nang, mainly self-producing enterprises.

Mr. Ha Giang, Chairman of the Board of Directors of the company, said that the scale of the industry of manufacturing and assembling finished products in the city is still limited, there is no leading enterprise in the regional production chain to lead the development. Most of the steel materials for mechanical manufacturing in the city must be imported; enterprises lack connectivity so they cannot support each other in the same industry...

According to the Department of Industry and Trade, Da Nang has about 110 enterprises operating and capable of participating in production activities in the supporting industry sector, accounting for 6.3% of the total number of industrial enterprises in the city. Of which, enterprises producing products in the list of priority supporting industry products for development are still quite few, only about 52 enterprises, most of which are small-scale domestic enterprises. The added value of the mechanical engineering industry (excluding automobile and vehicle assembly and manufacturing industries) accounts for 14.4% of the total added value of the entire processing and manufacturing industry in the city, of which the supporting industry sector of mechanical engineering and machinery manufacturing accounts for only about 1.9%.

Mechanical enterprises can be temporarily classified: enterprises investing in new technology with high-tech processing centers such as Huynh Duc Trading - Service and Production Company Limited, Minh Thinh Loi Production - Trading Company Limited; enterprises manufacturing construction structures such as Ha Giang - Phuoc Tuong Mechanical Joint Stock Company, VNECO.SSM Steel Structure Manufacturing Joint Stock Company; enterprises trading and contracting for construction and installation of electronic equipment, telecommunications such as Vina Toan Luc Trading - Service and Import of Electronics and Telecommunications Joint Stock Company, Vietnam Engineering Company Limited...

Mr. Nguyen Phu Hoa, Chief of Office of the Mechanical Association (Union of Science and Technology Associations of Da Nang) informed that in general, mechanical enterprises in the city are small in scale, some fields are lacking and weak such as casting and metallurgy. The casting industry accounts for 40-70% of the value in the industrial production chain, but Da Nang alone does not have any brand in this field. Mechanical enterprises in the city still operate separately instead of linking up to develop together. In addition, most enterprises do not have strategic key products but depend on orders from partners. In the current context of the world and domestic economy, partner enterprises reduce investment, production costs increase, the production scale of mechanical enterprises is narrowing further. However, this is only a temporary difficulty, in the long term, the opportunities for the mechanical industry are still very large. To increase connectivity, mechanical enterprises need solutions such as having a program to support technological innovation and incentives for mechanical enterprises to enter industrial clusters and zones at reasonable costs; directing foreign direct investment (FDI) capital into the supporting industry sector of the mechanical industry...

CINNAMON

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