Engineering firms lag in smart, automated production

12:34 | 21/10/2018 Industry

(VEN) - Vietnam’s engineering sector currently meets only 32.5 percent of domestic demand, while the goal set in its development strategy is 45-50 percent. 

engineering firms lag in smart automated production

The data were presented at a recent workshop by the Ministry of Industry and Trade (MoIT) to promote implementation of the development strategy for the engineering sector in the context of Industry 4.0.

Pham Tuan Anh, Deputy Director of the MoIT’s Industrial Department, said the domestic engineering sector has advantages in manufacturing motorcycles and motorcycle spare parts, home appliances and instruments, autos and auto spare parts. These products account for nearly 70 percent of the sector’s total production value. In 2016, Vietnam exported more than US$13 billion worth of mechanical products, mostly home appliances and spare parts for autos and motorcycles.

However, according to Pham Tuan Anh, Vietnamese engineering firms lack opportunities to supply equipment for investment projects in the domestic steel, chemical and energy sectors. He attributed the problem to their lack of international-standard quality control systems and well-known brands. Moreover, their registered inventions remain limited, reflecting the stagnant technological innovation in the engineering sector. The result is a vicious circle, with most engineering firms finding it difficult to sell their products and therefore lack capital to invest in technological innovation, which in turn hampers their development.

According to Deputy Minister of Industry and Trade Do Thang Hai, the MoIT will propose the establishment of an industry support center to help firms improve their equipment and technologies, and encourage engineering companies to apply smart and automated technologies in manufacturing.

Pham Hung, former general director of the LILAMA Corporation, believes Industry 4.0 will change the traditional design and manufacturing technologies of the engineering sector.

In the opinion of Ho Manh Tuan, Deputy General Director of the Vietnam Engine and Agricultural Machinery Corporation, investment incentives for engineering companies are needed, especially for those with large-scale manufacturing activities, well-known brands and stable sales.

Dao Phan Long, President of the Vietnam Association of Mechanical Industry, said the domestic engineering sector should concentrate on manufacturing/assembling specific products that can compete with foreign ones, such as trucks, buses, non-standard equipment and steel structures. In his opinion, the state should apply policies that help domestic companies attract new orders and seek new markets for their products.

Deputy Minister Do Thang Hai affirmed that the MoIT would maintain coordination with relevant departments and sectors to help engineering companies overcome difficulties. The ministry will draft a government decree to promote the engineering industry and will coordinate with businesses and associations to adjust the list of major mechanical products.

The MoIT will build a standard system to control the quality of domestic mechanical products according to

international standards. It will also issue technical regulations for major mechanical products.

Lan Anh