Mold maker VEM Tooling Ltd. is opening a new factory in Bulgaria in a joint venture with German injection molder Mecalit GmbH Kunststoffverarbeitung and is planning additional investments in India and Thailand.

VEM, which is German-owned but has its factories in three Asian countries, said the move to Bulgaria next year is in response to European customers, including Mecalit, who want to source molds closer to home.

It is investing at least $1.5 million in the plant in Plovdiv, Bulgaria, which will be located at an existing Mecalit factory. It's VEM's first facility outside Asia.

"I do have a lot of European customers who, 10 years ago, were very excited to go to China or to Asia, who now tell me 'Ah, we'd rather be in Eastern Europe or stay in Europe,'" said President Marc Weinmann.

VEM, which has operations in China, Thailand and India, is also continuing to make more investments in Asia. Part of that is driven by what it says is a shift away from China as a source of lower-cost molds.

The company, for example, is expanding a factory in Pune, India, that it opened last year. It's doubling the floor space of the operation to 3,000 square meters by renting additional space and now has 85 employees, up from 35 when it opened, Weinmann said.

"I can still see China costs going up for the next few years, and India is a growth story itself," he said, noting demand from carmakers such as VW who want to localize production in India for cars made for the local market.