LEGO’s first U.S. factory in Chesterfield, VA to cost + $1billion

Watchful Eye

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Aerial view of LEGO's new Chesterfield, VA manufacturing siteCourtesy of LEGO Group

LEGO is investing over $1 billion to build its first U.S. factory in Chesterfield, VA.

This project involves 1.7 million sq. ft. of new-build construction. The building will be designed to operate as carbon neutral, and there will be a solar facility built onsite.

That solar facility is supposed to generate enough renewable energy to meet the demands of the plant. And that’s not a commitment for an approximate match, it’s supposed to equal “100 percent of its day-to-day energy needs.”

It seems that solar was a notable part of the deal.

“The location in Virginia allows us to build a solar park which supports our sustainability ambitions…” said LEGO Group CEO Niels B. Christiansen via press release.

Why a LEGO U.S. factory

Lego’s Chesterfield factory will be its seventh worldwide. According to its statement, the facility will mold, process and pack LEGO products. Then, being where it is, the site will help shorten the supply chain.

“Our factories are located close to our biggest markets which shortens the distance our products have to travel. This allows us to rapidly respond to changing consumer demand and helps manage our carbon footprint,” said Carsten Rasmussen, chief operations officer of LEGO Group.

LEGO Group outlook

Apparently bullish, LEGO believes the Chesterfield site is going to support its long-term growth. Furthermore, the company has a manufacturing site in Monterrey, Mexico. They plan to expand and upgrade it “to meet growing demand for LEGO products,” the company statement says.

“Our new factory in the US and expanded capacity at our existing site in Mexico means we will be able to best support long-term growth in the Americas. We are fortunate to find a location where we can begin construction quickly and create temporary capacity in under two years,” Rasmussen said.

The deal

Chesterfield County and the state of Virginia believe they’ve struck a deal. Governor Glenn Youngkin called it a “transformational project.”

A statement from the governor’s office states LEGO Group will be eligible to receive an MEI custom performance grant for $56 million. But that’s compared to the company making an investment of over $1 billion plus creating over 1,760 jobs and also making site development improvements estimated at up to $19 million, subject to approval by the Virginia General Assembly.

If you’re wondering who landed this deal, the governor’s press release says: The Virginia Economic Development Partnership worked with Chesterfield County, the Greater Richmond Partnership, and the General Assembly’s Major Employment and Investment Project Approval Commission to secure this project for Virginia.

Looking ahead

“We were impressed with all that Virginia has to offer, from access to a skilled workforce, support for high-quality manufacturer and great transport links. We appreciate support for our ambition to build a carbon-neutral run facility and construct a solar park…,” said Niels B. Christiansen, CEO, of LEGO Group.

Construction is supposed to start on LEGO’s Chesterfield manufacturing facility in the fall of 2022, and the factory is projected to crank up in the second half of 2025.

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