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Hansae's Guatemala hub will reduce costs and emissions while navigating trade issues

Published: 10 Nov. 2025, 17:56 Updated: 11 Nov. 2025, 18:32

A brushing machine operates at a Hansae factory in Vietnam. [JOONGANG ILBO]

HO CHI MINH CITY, Vietnam — Hansae, a major Korean apparel manufacturer, is expanding its environmentally friendly, vertically integrated production model from Vietnam to Guatemala, aiming to build a second global hub that will reduce environmental impact and avoid U.S. trade barriers.

The company is investing $300 million to build a 500,000-square-meter (5.3 million-square-feet) industrial complex in the Michatoya Industrial Park in Guatemala by the third quarter of 2026. The new site will replicate Hansae’s proven model in Vietnam, combining spinning, fabric dyeing and garment manufacturing in one location.

Hansae plans to use biomass-fueled boilers, water-saving dyeing machines and advanced wastewater treatment systems at the Guatemala plant, just as it does at its flagship facility in Vietnam.

C&T Vina, a subsidiary of Hansae located in Dong Nai, about 88 kilometers (54 miles) north of Ho Chi Minh City, is the core of this strategy. Its third factory uses 100 percent biomass fuel — made of compressed rice husks, cashew nut shells and sawdust — instead of coal, significantly cutting emissions.

Inside the facility, modern dyeing machines reduce water use by more than 40 percent and operate nearly twice as fast as older models. Over 4,500 tons of wastewater are treated daily, with 1,500 tons reused through a reverse osmosis (RO) system. The factory aims to cut carbon emissions by 60 percent, water use by 50 percent and electricity use by 15 percent by 2027.

C&T Vina is the first Korean-owned textile plant in Vietnam to receive Leadership in Energy and Environmental Design certification for sustainable buildings.

“The treated water is as clean as tap water,” said Park Joon-young, head of administration at C&T. “For overseas buyers, decarbonization and environmentally friendly production are now basic requirements.”

Hansae’s model emphasizes vertical integration, bringing yarn production, knitting, dyeing and sewing to a single site.

A logistics robot operates at a Hansae factory in Vietnam. [JOONGANG ILBO]

This shortens supply chains and limits disruptions from raw material or logistics issues. That strategy has helped Hansae build long-term partnerships with global retailers including Gap, H&M, MUJI and Target.

The Guatemala facility, to be operated under the name C&T Guatemala, will have the capacity to process 50,000 kilograms (110,230 pounds) of fabric per day. It will also feature a new AI-based camera inspection system to improve quality control and reduce defect rates.

Hansae’s acquisition of U.S.-based textile firm Texollini last year also plays a key role in this expansion. Hansae plans to apply Texollini’s fiber technology in Guatemala to increase production of high-value activewear.

“Guatemala will serve as our second global production base after Vietnam,” Kim Ik-hwan, vice chairman of Hansae, said. “This project completes vertical integration across the Eastern and Western hemispheres, helping us diversify production risk and offer more supply-chain options to our clients.”

Kim Ik-hwan, vice chairman of Hansae, speaks about the group’s vision at a global investor event on Oct. 29. [HANSE]

The company chose Guatemala for its proximity to the U.S. market and its favorable trade terms. While U.S. tariffs on garments made in Vietnam or Bangladesh hover around 20 percent — and reach up to 45 percent for Chinese goods — Guatemala faces lower rates of about 10 percent.

Korean fashion manufacturers are increasingly shifting production westward in response to the U.S.-China tariff war. Hansae currently produces about 40 percent of its garments in Vietnam, with more than 85 percent of that output exported to the United States.

Other Korean apparel firms are also diversifying their production bases. Sae-A Trading recently acquired factories in El Salvador and a U.S. subsidiary to boost North American capacity, while Hwaseung Enterprise is building a new environmentally friendly footwear factory in southern India.

By moving closer to the U.S. market, companies expect to cut delivery times and strengthen control over inventory and quality. In Vietnam, production-to-delivery timelines typically stretch to six months. In Guatemala, that window is expected to shrink to about four months.

Hansae projects that the Guatemala facility will help drive a sharp increase in revenue. Combined with its Vietnamese operations, the company expects C&T’s total sales in 2026 to reach 276 billion won ($190 million) — up 30 percent from this year.

This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
BY BAE HYUN-JUNG [[email protected]]