Taiwanese based textile maker Far Eastern New Century Corp (FENC) to reduce reliance on its two major production bases, Taiwan and China has taken up capacity expansion project at its Vietnamese plant which will be completed in 2020, yesterday said it expects Vietnam to become its third-largest production base.

The capacity expansion is aimed at creating a complete supply chain for fabrics and garments in Southeast Asia, and is projected to cost more than US$700 million, it said.

Revenue generated at the Vietnamese plant is likely to take up 30 percent of the firm’s total sales over the next three years, up from less than 5 percent at present.

Taipei-headquartered FENC reported NT$132.4 billion (US$4.36 billion) in revenue last year, down 0.4 percent from 2015. Revenue from Taiwanese plants takes up nearly 60 percent of the firm’s total sales, while the Chinese plants contributes 40 percent, company data showed.

Aided by expanded capacity in Vietnam, revenue generated in Taiwan is expected to account for 40 percent of total sales in 2020, with sales from China taking up 30 percent, FENC said.

The company, which manufactures a wide range of petrochemical and textile products, has an annual production capacity of nearly 2 million dozen garments in Vietnam, company’s data showed.

As part of the expansion plan, a new plant that makes knitted fabrics began operations this quarter, while several new factories making polyester garments are set to start production by the end of next year, it said.

FENC is considering expanding production capacity of several nylon products used to manufacture car airbags and seatbelts as it eyes the growing automotive safety components market, the company official said.

It is also planning to raise the capacity of polyester staple fiber for diapers and sanitary products at its Taiwanese and Chinese plants. The polyester and textiles businesses accounted for 28 percent of the firm’s total assets last year.

The 66-year-old company also expects that the launch of several high-end products could drive sales growth in the near term.