(Yicai Global) Dec. 30 -- Chinese home appliances giant Midea Group intends to double its overseas e-commerce business next year following an 80 percent increase this year, according to Vice President Wang Jianguo.

To achieve the goal, Wang told Yicai Global that Midea “hopes the talent recruited this year in the cross-border e-commerce field will have a more powerful ability to define products, run data operations, and quickly understand user needs” in combination with the company’s existing supply chain advantages.

He is optimistic about demand from overseas in the first half of 2022. Sales remain robust and clients are still restocking despite retail prices rising due to cost increases, according to data collected in major foreign markets during the Christmas period.

The Foshan-based company is responding to surging raw material prices and shipping costs in China through various means including innovative overseas logistics solutions and offshore manufacturing, Wang said.

Costlier commodities and cargo rates are the main challenges facing home appliance exports, he said, adding that higher prices are being passed on to consumers. The prices of raw materials such as copper and plastics have inched down after this year hitting the highest levels in seven or eight years, and they are expected to fall further, he said.

Midea has a certain scale and cost advantage, coupled with the use of locked-in yuan exchange rates, foreign exchange tools, and commodities futures to gradually absorb the pressure of rising costs, Wang said. It also teamed up with logistics providers such as China’s Cosco Shipping Holdings and Denmark’s Maersk this year to deal with solve soaring freight costs.

The firm accelerated its offshore manufacturing efforts this year to cope with surging costs in China, Wang said, noting that Midea has a total of 34 production bases, half of which are overseas.

Its air-conditioner plant in Thailand has begun trial output and it is expected to start mass production before the end of next month. In the southeast Asian country, Midea has also expanded production capacity of fridges and washing machines and acquired a compressor plant.

In Egypt, Midea built several new projects this year. A water heater plant in the north African country will be put into operation before the end of January, while fridge and washing machine plants will start up in late November. A dishwasher plant will begin mass production in the second half of next year.

Midea also is in the process of picking locations for small and major appliance plants in Brazil. A small products project in Argentina has already gone into operation, while site selection site for a new plant in Mexico is underway with the hope of finalizing it in the first quarter of next year.

Moreover, Midea is considering setting up manufacturing bases in Eastern Europe as it expects production capacity abroad to account for a third of its overseas income by 2025, Wang said when speaking about long-term goals.

Shares of Midea [SHE: 000333] have declined 25 percent this year. They ended little changed today at CNY73.96 (USD11.60) each.

Editor: Futura Costaglione