The LEGO Group celebrates opening of factory in China
Posted by TheBrickPal,
The factory in Jiaxing, south of Shanghai, will supply children, parents and fans across Asia with safe and high-quality LEGO play experiences. The factory will feature solar panels and other initiatives to reduce its environmental impact.
Today, the LEGO Group celebrates the official inauguration of its new factory in Jiaxing, China. The 165,000m2 factory plays an important role in the Group’s ambition to provide safe, high-quality creative play experiences to millions of children in China and across Asia.
“We believe children are the most important people on the planet. We also believe it is essential for children to play – as they learn to be creative and imaginative through play,” says Jørgen Vig Knudstorp, President and CEO of the LEGO Group, adding:
“We have built a state of the art factory in Jiaxing that adheres to the same global production standards as our factories across the world. It will bring great and fun LEGO experiences to even more children in Asia, while delivering on the promise of the LEGO brand: safe and high-quality play.”
The LEGO Group also owns and operates factories in Denmark, Hungary, Mexico and the Czech Republic.
Product quality and safety are top priorities
Every LEGO product starts its life in the LEGO Group Headquarters in Billund, Denmark, where more than 250 designers representing 35 nationalities develop hundreds of new exciting play experiences every year.
“Our designers work hard to push the boundaries for how children can use LEGO bricks in new, innovative and exciting ways year after year. Their designs are based on global consumer insights, extensive research, and a deep knowledge of our heritage and the LEGO System in Play,” says Jørgen Vig Knudstorp.
It takes between one to four years for a new LEGO product to complete the journey from design concept to stores around the world.
“Our founder, Ole Kirk Kristiansen, was a carpenter and introduced our company motto; “Only the best is good enough”. To this day, we take great care to ensure that every LEGO product is fun, engaging and offers a high-quality experience to children. We also make sure that every product is safe. Every LEGO brick we manufacture in Jiaxing lives up to the strictest global safety standards,” says Richard Wong, Senior Vice President and General Manager at the LEGO Factory in Jiaxing.
Solar energy to reduce environmental impact
The Jiaxing factory has a high focus on integrating sustainable solutions from recycling and reusing waste and water to minimising the energy consumption.
“We aspire to leave a positive impact on the society. Our most important impact comes through the LEGO products that inspire and develop millions of children. In doing so, we want to leave the planet in the best possible condition for children and so we have a broad range of activities to reduce our impact on the environment. As an example, the LEGO factory in China will feature solar panels on the roof, enabling us to generate clean solar electricity directly at our factory,” says Tim Brooks, Vice President, Environmental Sustainability.
(Explore the different approaches to energy efficiency and environment at the LEGO factory in Jiaxing here)
Facts about the factory
- The factory covers an area of approximately 165,000 m2.
- The land where the factory is located covers 315,000 m2.
- 45,000 m2 area for packing.
- 25,000 m2 manual warehouse.
- 10,000 m2 area for decoration and assembly.
- 35,000 m2 moulding facility.
- 6,500 m2 automated high bay warehouse. 24 metres high with a capacity of more than 400,000 storage boxes.
- More than 1,200 people are currently employed at the factory.
- The investment amounts to a 3-digit million Euro figure.
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45 comments on this article
Nice! What effect, if any, could this new factory have on counterfeit Lego?
Pretty nice factory! The interactive map has a lot of interesting details about the ways it was designed with sustainability in mind. Hopefully this factory will help LEGO make their products more affordable in Asian countries.
I am curious whether LEGO will continue contracting out the parts that are currently produced in China (like CMF parts), or whether they will move that production to their own new factory.
The model of the factory shows it covered in solar panels but I can't see any in the photo. The large rectangles in the foreground are asphalt parking spaces and the white things all over the roof appear to be merely the ends of ventilation ducts.
This areamaizing news indeed. It's great to know that a new product can take up to four years from concept to production, that fills me in due to an interest in making my internships there.
Yay! Now LEGO's quality will get even worse as they jack the profits margins up 1000% higher!
Factory looks great but DAM now even Lego is made in China like everything else!!!!!!!!!!!!
Let's hope they'll be able to keep the Lepin spies out and the new sets and parts in...
So this factory will only make parts for sale in Asia?
@The Green Brick Giant: First of all, it's been established that the new factory will be serving the Asian market — people in other parts of the world shouldn't notice any difference. Second, there's no reason (aside from Eurocentrism) to think the quality out of this factory would be any less than the quality out of the Czech, Hungarian, or Mexican factories. And third, LEGO prices have been fairly stable for years now, and in many cases are lower than they were in the 80s or 90s. As long as those prices remain stable, does it really matter how much of it pays for design/production and how much is profit?
LEGO Inside Tour in China? I'd fly from Canberra for that!
But is it going to be safe? How about quality? I'd expect that to be high. But the article isn't quite clear enough about the whole safe/high quality play issue ;-)
The quality of a Chinese factory, like a factory anywhere else in the world, is dependent on the standards set by the people running it. The same for safety standards, which I've seen first-hand. As an example, when I was working in China years ago, a friend met someone on a plane who represented a Chinese tooling company that made drill and router bits. He toured their factory (trying to set up a deal), and they offered several quality grades, depending on how tight they set the tolerances on their machining and sorting equipment. Their top grade was for a hand and power tools company in the US, which is known for their lifetime warranty.
So if LEGO values quality and safety, they will be setting up the same testing they set up in the other countries. Even more, if they are worried about, say, locally-sourced paints potentially containing lead.
As for quality, if this is feeding Asia, there are long-time customers in Hong Kong, Singapore, etc. who are used to the same high standards that we all are, and I'm sure they will bring it up if the quality degrades.
So I'm guessing the economies of scale, cheap labour, massive local market and reduced shipping will see absolutely ZERO impact on prices in the Asia-Pacific region. If anything, I wouldn't be surprised to see prices creep upwards relative to US/UK markets, because the cost of the new factory will be paid directly by consumers.
Will the local region Amazon stores be allowed to sell LEGO to New Zealand, or will the trade embargo that TLG put in place continue maintaining sky-high prices? I'm certain there'll be no change.
Will this have any effect of the cheaper alternatives and blatant knock-offs? Not one iota. I suspect they're gleefully partying right now, just thinking about their easy access to the inner workings of LEGO's operations.
On the plus side ... errrm, nope. Can't think of one.
Aanchir, surely this factory will serve the Australian & NZ markets, not just Asia.
Behold the tsunami of Leles, Lepins and other fake LEGO brands from China!
cant believe the factory opened this soon near home.hopefully everything goes well and best wishes to lego but worst nightmares to clone brands:)
And now, the counterfeiters have a direct in-country source for parts, boxes, etc. Not that they really needed the help...
Cherrs, 30min driving near my home, hope if there is an LEGO Outlet near factory~
dark age of lego begins
@oldfan
Hey, look on the bright side! LEGO can now give people a better idea on what the real deal looks like! Maybe they could also include something giving a heads up on the clones in the boxes or something?
When they outsource manufacturing to places like China they only really have themselves to blame for clone brands like lepin .
Is not in China where a lot of copies of Lego are?
This jars with me. I don't like that LEGO are prepared to get into bed with a country with an atrocious attitude towards human rights and free speech and does nothing to combat the sustained attack on LEGO's own intellectual property rights from the garbage that is Lepin and the like.
Just goes to show that when it comes to making money LEGO are no different to any other greedy corporate entity.
If you look at the accuracy and sophistication of Lepin clones it's clear they are doing well without local access to Lego factories. All this might bring is slightly quicker access to those designs.
If you look at the prices of Lego in South East Asia (the part I'm most familiar with) they can be eye-wateringly high and this, I suspect, is because they need to be imported from the rest of the world plus a certain Western caché premium. Anything that improves supply and reduces transport costs for people in Asia is a good thing!
Regarding quality, I may be misinformed, but I was under the impression that Lego already had many minifigs done in China because they offered superior print detailing in terms of which parts of the body could be printed on. I have definitely noticed a cheapness to the sound and feel of the ABS of recent collectible minifigs. I hope the two things aren't related...
I'm really curious how this will end. This factory was hyped 3 years ago because as the article says It's ment to me just for Asian market and to lighten other factories works and to cut parts migrations from other factories.
We will see! :) Teoritycaly that should mean we WILL get better quality back again.
If price can't go down, there is no good reason to run a new factory like that.
Noticed the PR's main points are bringing Lego to more Asian children, factory sustainability, safety, environment friendly etc, there is no mention of TLG selling products at lower cost to Asian customers, so don't expect prices to drop.
All the savings in worldwide transport, import/export duties etc only mean more profit for the TLG group, definitely won't be passed down to the consumers. In fact, considering the amount they have invested in this factory the opposite (i.e. increase in price) is likely to be true.
^well said.
Send in the Clones.
@Huey1 per a separate article on Lego's site, the solar panels are to be installed in 2017.
https://www.lego.com/en-us/aboutus/news-room/2016/november/jiaxing-factory-solar-panels/
I actually once brought up the fact that the factory in china was a bad idea, to a customer service rep. There is no question that parts will fly out the back door. Whether to knock off brands or onto eBay it's going to be interesting. My fear is regardless of the excellent job Lego does overseeing production in other factories, this will not carry over to china. I'm hoping I am wrong but by mid 2017 we will probably be seeing strange Lego parts in sets. Not defects per se. As the molds are still crafted outside china i think. But in the quality of the material the bricks are made of.
It's a wait and see attitude. But if other major companies are a guide to go by. Regardless of who's name is on the factory. The substandard manufacturing in china will show through.
Afterthought though. Yes they built it to cut down cost/shipping to asia. But if bricks are being produced at a fraction of the cost of Europe. How long until those parts are in all sets.
@welldontaskme: "Parts flying out the back door" already seems to happen occasionally at other LEGO factories, so as long as LEGO doesn't invest any LESS in security here than they do elsewhere, that wouldn't be any sort of change to the status quo. It's not as though Chinese workers have some predisposition for thievery that Danish, Czech, Mexican, or Hungarian workers lack.
Same goes for the quality of the manufactured product. There is nothing about Chinese manufacturing that makes Chinese-made products inherently substandard. When they are, it's the fault of the company doing the manufacturing for not enforcing their own high standards, not the fault of the country of manufacture.
Now, if the LEGO Group DOES fail to exercise the same careful oversight at the Chinese plant as at their other plants, then they would bear the full blame for what happens — but it wouldn't be because of WHERE they chose to build the factory.
New Lepin factory. :)
Aanchir - there is something inherently Chinese about poor quality. It is indisputable that the quality from a Chinese factory is less than that from an equivalent German or Danish one. The people are typically less creative, more prone to bribery etc because of the bad system of Government. Why are Chinese branded and manufactured cars of poor quality - because they copy rather than innovate and do not have a quality culture.
Funny. Apple builds many of its products in China; they don't seem to have inherently poor quality. I also don't see why having a factory in China will significantly increase cloning, since the pirates harvest ideas very efficiently already. In fact, it might make it easier for TLG to use Chinese law against pirate manufacturers, once the piracy is directed against a Chinese-based product.
@mike978: Those are all things that some people believe, yes. Were you trying to make some other point, or just rattle off a bunch of sweeping generalizations about 1.3 billion people (over four times the entire population of the United States)?
@sklamb: Extremely good observations.
TLG is strange really. They recently severed their promo deal with the Daily Mail for publishing anti-migrant articles. Now they set up a factory in a country that has serious human rights issues and is extremely tight on censorship. Don't know what I mean? Watch this: https://www.youtube.com/watch?v=c1HdCIW2Xtk
"And third, LEGO prices have been fairly stable for years now, and in many cases are lower than they were in the 80s or 90s."
This is still a thing? How many $500 Lego sets were released in the 90s, because I don't remember many? Lego is more expensive now than it's ever been. "Oh but price-per-price is the same as it was 30 years ago" which means that, larger sets equals higher prices.
"Funny. Apple builds many of its products in China; they don't seem to have inherently poor quality."
You remember the stories from a few years ago where Apple was buying from a factory in China where the factory owners were allegedly guilty of all kinds of abuse and bullying (with a significantly high suicide rate) against their employees? Maybe that's not a good example if you're looking for a tick in the 'yay' column?
I think that's the end for myself as a Lego customer
Aanchir - I wonder if you are Chinese since you seem very determined to push back against the fact that China is known for copycat, low quality manufacture. Yes they can in some instances do high quality work, but that is not the majority of what they make - just look at the crap Walmart typically sells. Zordboy makes some good points about the allegedly good Apple factories and how staff were treated.
@Zordboy: There are definitely larger sets out today than in the 90s, but the $200+ range still makes up only a handful of big sets each year. The average price of a set or the price of a typical set has not gone up, because for every one of those ginormous exclusives, there are many, MANY smaller sets. (check Figure 7 here: http://www.realityprose.com/what-happened-with-lego/)
The Apple story is unfortunate but not really relevant here, because this isn't a factory LEGO is "buying from". This is a factory that they wholly own and operate themselves. If any kind of abuse happens at this factory, LEGO will be 100% to blame, and not because they chose to set up shop in China, but rather because they themselves will be the perpetrators of that abuse. But judging from the LEGO Group's strong commitment to safety, ethics, and employee wellness at their other factories (https://www.lego.com/en-us/aboutus/responsibility/caring-ethical-and-transparent/respectful-workplaces), there's no reason to think they'd suddenly decide not to care about their workers at the new plant.
@mike978: It's HILARIOUS that all I have to do is make a common-sense claim that Chinese workers are as capable as workers anywhere else in the world and I'm suspected of being Chinese. I'm not, BTW. I'm white and have lived in Virginia all my life.
A lot of Chinese companies do make cheap, low quality products. But that's because there's an enormous market for those sorts of products, both in China and abroad. Not because Chinese companies don't know/care about the difference between a high-quality and low-quality product, or because Chinese workers are less capable than those in Europe or the Americas. To believe that is ignorance, plain and simple.
Aanchir - the Chinese make, as you admit, a lot of crap because they copy and do not innovate. I work in drug development and the Chinese are well known for their, relative, lack of innovation and compliance with rules. Of course there are exceptions, as you would expect from such a large country. But they are not like say the Japanese who you can trust to make good quality products.
For a company that has such an obsessive level of security surrounding its own ideas and trade secrets, setting up in China has to be its dumbest move yet.
Where are the other factories in China where LEGO gets parts from?
@BG3D: I'm not entirely sure. I did a Google search and found a neat timeline of the LEGO Group's involvement in China (https://mi-od-live-s.legocdn.com/r/.../en_timeline_lego-china_2016.pdf), but all it says is that as of December 2010, "8-10% of all LEGO® elements are manufactured in China by LEGO suppliers. This means that one in three LEGO sets contains elements made in China. The LEGO Group has more than 30 suppliers in China. Most of them supply LEGO products within Extended Line (water bottles, key rings, etc.)" It doesn't list the suppliers or what each of them produces.