ITL Corporation commits $200 million to Vietnam's warehousing infrastructure

At the Vietnam Logistics Summit 2023 in Ho Chi Minh City, jointly hosted by SLP Vietnam and VIR on October 5, Alexander Olsen, vice president of Freight Management & Commercial at ITL Corporation, unveiled the firm’s ambitious plans.

Alexander Olsen, vice president of Freight Management & Commercial at ITL Corporation

Specifically, ITL Corporation is primed to channel a substantial investment of around $200 million into warehousing infrastructure over the next half-decade. According to Olsen, this substantial commitment is a testament to the pivotal role that Vietnam plays in their strategic expansion.

"Vietnam is our key market with a high potential for development," Olsen said, emphasising the pivotal role that Vietnam plays in their expansion strategy.

"I see the opportunities for Vietnam’s logistics sector are extremely good. The 'China + 1' strategy, infrastructure improvements in Vietnam, growing manufacturing, and the ongoing trade tensions between the US and China have attracted significant investments into the country."

According to Olsen, as more companies adopt the 'China + 1' approach, diversifying their supply chain strategies to reduce dependence on China, it creates new avenues for expansion in the logistics sector.

This strategic shift is complemented by Vietnam's commitment to enhancing its infrastructure and connectivity, fostering an environment conducive to attracting foreign investments.

However, challenges remain, especially regarding infrastructure.

"From a logistics perspective, we foresee a growing demand for assets and enhanced infrastructure," Olsen said.

Vietnam's existing infrastructure, while improving, presents challenges to the sector's efficiency. Despite this, notable progress includes the development of new ports in the southern regions of the country and the ongoing completion of a vital highway connecting the north and south.

Private companies like ITL Corporation are playing a pivotal role in addressing these infrastructure challenges by making substantial investments in areas such as warehouses and fulfillment centers.

"Within ITL Corporation, we are focusing on expanding our port facilities and using transportation to integrate services, promoting sustainable development," Olsen said. "Additionally, we are working on enhancing solutions to reduce logistic costs, a critical area of concern."

Trucking currently constitutes a heavy reliance within Vietnam's logistics network, leading to significantly increased transportation costs.

"Even external technology investments are not uniformly accessible at 100 per cent. Vietnam presents distinct challenges, such as the absence of suitable technology for freight vehicles, software incompatibilities with management systems, language barriers, and regional-specific technology optimization hurdles, all of which complicate the adoption and utilisation of technology within the country," he said.

In a discourse on sustainable growth, Olsen added, "Our focus revolves around warehousing, energy conservation, and the utilisation of electric vehicles, with several solutions actively being deployed. A notable development includes the formation of an electric vehicle fleet."

Vietnamese government committed to boosting logistics infrastructure At the Vietnam Logistics Summit 2023 co-hosted by SPL Vietnam and VIR, representatives from the Vietnamese government reaffirmed the country's steadfast dedication to enhancing the nation's logistics infrastructure.

SLP delves into unlocking the potential of Vietnam's logistics industry On the sidelines of the Logistics Summit 2023, Edwin Chee, COO of SEA Logistics Partners (SLP) Vietnam, spoke to VIR's Thanh Van about the company's investment in the nation and how to unlock the potential of its logistics industry.