New US Lego factory raises concerns about North American HQ

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Officials in Connecticut say the decision of Lego Group to build a new factory in Virginia won’t affect the company’s North American headquarters in Enfield, but industry watchers say there could be cause for concern

ENFIELD, Conn. — Lego Group’s recent announcement that it will build a new factory in Virginia has focused attention on the company’s North American headquarters in Connecticut, with some industry watchers saying it may not be a good sign for the company’s future in the state.

The Danish-based global toymaker announced last Wednesday that it will invest more than $1B to build a factory near Richmond. It is expected to open in 2025. The factory will be the seventh in the world and the first in the U.S . A spokesperson for the company said that the decision would not have any impact on the Enfield headquarters’ size or scope. A spokesperson for Democratic Gov. Hearst Connecticut Media was told by Ned Lamont that Lego’s senior leadership has affirmed its commitment to keeping the office in Connecticut.

” It is not unusual for corporations to invest in and expand in multiple state — and they do it for a wide range of strategic reasons,” Max Reiss stated to the news outlet. “Lego has been and continues to be a fantastic partner with our state and we look forward to strengthening this relationship now and into the future.”

Still, the development raises the question of whether the headquarters might eventually move to Virginia, Fred Carstensen, a professor of finance and economics at the University of Connecticut, told Hearst.

” State officials should be concerned, Carstensen stated. Donald Klepper-Smith, an economist at DataCore Partners, stated that physical proximity to manufacturing facilities is a factor companies consider .”

. However, there are many factors that could have influenced the decision to locate the factory elsewhere.

“Economic growth these days speaks to cost structures,” Klepper Smith told Hearst. “Fifty percent of your long-term job growth is a function the cost of doing business. And when it comes to Connecticut, businesses are being incentivized to look elsewhere.”

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