BAT Builds 2nd Plant in Korea

Source from:  The Korea Times 06/13/2016

British American Tobacco (BAT) has decided to build its second plant here to nurture its Korean unit as an export hub in the Asia-Pacific region.

To construct the state-of-the-art manufacturing facility, BAT will invest $86 million over the next year and a half, creating more than 100 new jobs and bolstering its business dealings with local partners.

BAT Korea said Friday that it will set up the new plant near its existing production facility in Sacheon, South Gyeongsang Province.

"We are pleased to announce a plan to expand our production facilities, which represent an important milestone in BAT Korea's history," said company vice president Bae Yoon-suk during the groundbreaking ceremony at the construction site. "Once the project is completed in January 2017, the Sacheon factory will become an export hub for BAT's entire global operations."

When the second plant begins production, BAT Korea, whose flagship brands include Dunhill, Kent and Rothmans, expects its annual production volume will more than double to 35 billion cigarettes from 16.8 billion cigarettes. In 2017, the company expects to earn more than $260 million by exporting various cigarette brands, up from $100 million in 2015.

"Currently, the Sacheon plant ships tobacco products to Japan, Taiwan and 11 other countries. When the second factory is completed, we expect to conduct business in new foreign markets," the vice president said. "Accordingly, BAT Korea will export about 70 percent of its production in 2018 from the current 43 percent."

Since the Sacheon factory began exporting cigarettes in 2004, it has been serving as BAT's main production base in the Asia-Pacific region.

The facility has been recognized as a key manufacturing base in the region with its outstanding productivity, quality, cost savings and other criteria.

"Among BAT's 44 plants in 41 countries, the Sacheon factory has ranked highest in product quality and productivity since 2003," Bae said. "The plant has proven its excellent production capacity by reaching an accumulated production of 100 billion cigarettes in just 7 years. Recently, it exceeded an accumulated production of 200 billion cigarettes. Such a level of exceptional productivity is the result of achieving a win-win partnership between management and labor union."

In addition, the company's expansion plan will significantly help revitalize the regional economy by hiring more than 100 new employees and increasing business dealings with local suppliers.

"BAT Korea prioritizes securing local talent when it comes to hiring for the Sacheon factory," he said. "With approximately 90 percent of our 360 employees born in Sacheon or in nearby areas, we are known to be the most local-friendly company." Enditem