Lego’s Nearshoring Strategy
Lego Group is making strategic adjustments to its production network to respond to shifts in supply and demand. The company’s global supply chain network is designed to position manufacturing and distribution sites near its largest markets. This approach allows Lego to respond quickly to demand changes and keep its supply chain relatively short, reducing the environmental impact of shipping.
Investments in Manufacturing and Sustainability
To further optimize production, Lego is investing in manufacturing upgrades at several facilities. The company broke ground on its first U.S. manufacturing site in Virginia last year, with production expected to start in 2027. Additionally, a new factory in Vietnam is slated to open in 2025. Lego is also expanding capacity at its existing factories in Mexico, Hungary, and China.
In addition to modifying its manufacturing network, Lego is ramping up its sustainability efforts. The company reported an increase in the use of sustainably sourced resin for its toy bricks in the first half of 2024.
Lego’s strategic move to nearshore production is a testament to the growing trend among companies seeking production efficiencies for more resilient and dynamic supply chains. As companies like Lego continue to innovate and adapt their supply chain strategies, the industry will likely see a shift towards more localized production and sustainable practices.
