Ecco Tannery (Thailand) expect to repeat the 30% growth which they have seen for each of the past three years.
Managing director Bert Van Heesbeen said outlook for the leather industry in Asia – has prompted Ecco Tannery to invest US$2.5 million to raise the capacity at their tannery in Ayutthaya.
‘The investment will help the annual manufacturing capacity increase and make our Thailand factory one of the most technologically advanced and the third largest of our factories’, he said.
Annual production space will expand to 4.26 million sq m from the current 3.34 million, he said.
Ecco Tannery is an affiliate of the Ecco footwear manufacturing group with headquarters in Denmark. Last year, Ecco’s tannery earned just over Bt1 billion in total revenue, mostly by supplying 2.13 million sq m of leather to Ecco (Thailand)’s footwear manufacturing lines in the same premises.
The rest was traded to factories in China, Korea and Vietnam where Wilson baseball gloves and US Coach-brand bags and baggage are made.
‘For the past ten years there has been a remarkably strong trend of [setting up] major leather factories in Asia’, said Heesbeen, adding that it was aimed at catering to rising demand for leather products.
There has been increasing emphasis on development, he said, in order to optimise utilisation of available raw materials and maximise returns, particularly from exports.
The Ecco tannery, at the Saharattanakorn Industrial Estate in Ayutthaya province, was built in 1999 at a cost of $11 million with an additional $1 million spent on water treatment. The installation of new machinery from Italy will start next quarter.
Ecco have also announced a closer partnership with the Pan Group, the country’s largest shoe exporter, to launch new initiatives aimed at strengthening Thailand’s footwear industry. Ecco founder and ceo Karl Toosbuy said the first project would involve Ecco persuading their European suppliers to relocate their production to Thailand.
The second project focuses on training. A shoe ‘college’ would be launched next month with 30 students receiving practical training each year. Ecco will provide trainers and financial support worth 500,000 baht a year, excluding staff and equipment costs.
Ecco and Pan Group formed a joint venture, Ecco (Thailand), in 1994. Ecco control 95% of the venture. Ecco (Thailand) now serves as an Asian logistic hub for Ecco, the fourth in the world after Denmark, the Netherlands and the US.
