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An Insight On Malaysia’s Metal Fabrication Equipment Market

An Insight On Malaysia’s Metal Fabrication Equipment Market

Based on findings by Mordor Intelligence, metal fabrication holds an important place in Malaysia’s manufacturing industry and technological advances in IoT and automation have resulted in rapid changes in the domestic industry. Currently, fabricators are introducing strategies to both reduce production costs and incorporate new systems like the adaptation of control systems in processes that span across milling, forming, welding, machining, stamping and finishing. Similar, end user categories within the market include the oil & gas, automotive & aviation, power, chemicals & mining and construction industries among others.

Metal Fabrication Equipment Market, by Equipment Type And Application

(Source: Mordor Intelligence)

Malaysia’s metal fabrication equipment market can be segregated into machining, cutting, forming, welding and others when it is segregated according to equipment type. Conversely, the market can be broken down into residential, commercial and industrial sectors when segregated by application.

Future Outlook

Looking towards the future, metal fabrication equipment market is expected to grow at a heightened rate, as the world moves toward industrialisation and the population expands. And key players within the field include Amada, Atlas Copco, BTD Manufacturing, Colfax, Defiance Metal Products, DMG Mori, Hindustan Machine Tools, Interplex Holdings Pvt. Ltd., Kapco, Komaspect, Lancer Fabtech Pvt. Ltd., Matcor Matsu Group Inc., Sandvik. Standard Iron and Wire Works, Trumpf and Watson.

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US-China Trade War Continues To Negatively Impact Global Manufacturing

US-China Trade War Continues To Negatively Impact Global Manufacturing

The Trade War is continuing to impact the global manufacturing sector as Malaysian manufacturing slowed to its weakest pace of expansion since the IHS Markit survey began in 2012, and Taiwan’s manufacturing sector fell to its lowest growth since September 2015. While South Korea’s industry, which is heavily focused on tech production, also witnessed a shrinkage in manufacturing activities due to the impact of the US-China Trade War on chip and smartphone orders. Meanwhile, official economic data from Singapore showed that the country’s gross domestic product grew more slowly than forecast in the fourth quarter as the city-state’s manufacturing contracted on a quarterly basis.

In China, the Caixin/IHS Markit PMI slipped into the contraction territory for the first time in 19 months and manufacturing activity in Europe witnessed a stagnating growth towards the end of 2018, with Italy, France, Germany, Spain and Britain experiencing contractions. For Britain, factories are ramping up on stockpiling as possible border delays may occur following Britain’s exit from the EU in three months time. Although the US has experienced a decreased growth, the manufacturing sector is still expanding and this signals that China is suffering more from the Trade War than the US.

Overall, 2019 saw world shares start on a downbeat note with oil prices and bond yields experiencing a downturn as the factory survey data confirmed the picture of a global economic slowdown. In a key annual conference last December, China’s top leaders have mentioned that the government will support the Chinese economy in 2019 through cutting taxes and keeping liquidity ample, as they continue with their negotiations with Washington.

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Stronger Public Private Partnership Required To Drive Industry 4.0 In Malaysia

Stronger Public Private Partnership Required to Drive Industry 4.0 in Malaysia

KUALA LUMPUR, MALAYSIA: IDC believes that the 2019 Malaysia National Budget recently announced by Lim Guan Eng, the Finance Minister of Malaysia, was an important incremental step in achieving Malaysia’s vision to become a fully connected digital economy. The recent budget focused on the Industry 4.0 blueprint, titled “Industry4WRD”, which aims to make Malaysia the prime destination for high-tech industries in the region. The government plays a central role in the successful implementation of a robust Industry 4.0 strategy by creating clear policies and priorities to support the private sector. Initiatives like Industry4WRD focus the energy and creativity of the private sector around a common mission to create an era in which AI, robotics, 3D printing, and IoT will take centre stage and lead to digital transformation in Malaysia. IDC believes that direct support for Public-Private Partnerships (PPP) is necessary to focus Malaysia’s resources and boost the economic growth of the country.

The Malaysian government is continuing to adopt the necessary policy changes and budget priorities to strengthen the economic foundation for digital transformation and technology investments. For example, on November 7th, Malaysian Technology Development Corporation (MTDC) Sdn Bhd invited small and medium enterprises (SMEs) to embrace the fourth industrial revolution with the launch of the Centre of 9 Pillars (Co9P) initiative. This centre creates a physical location for ecosystem partners to interact for the development and incubation of solutions based on nine technology pillars including; Big Data Analytics, Autonomous Robots, Simulation & Augmented Reality, Horizontal & Vertical Integration, Internet of Things (IoT), Cybersecurity, Cloud, Additive Manufacturing and Supply Chain. IDC forecasts the size of the Big Data/Analytics investment in Malaysia will be $US670 million in 2019 led by the Banking industry while spend on IoT will be US$2.2 billion with the largest investment going into Manufacturing (2018 Big Data Spending Guide, 2018 IoT Spending Guide).

For almost a decade, IDC has been chronicling the emergence and evolution of the 3rd Platform of technology; the drive into Cloud, Mobility, Social and Big Data/Analytics technologies. The adoption of these technologies has accelerated as enterprises commit to the 3rd Platform and undergo Digital Transformation (DX) on a massive scale. Malaysia’s digital economy is in the early stages of creating an infrastructure with key core technologies (cloud, big data/analytics, artificial intelligence [AI], mobility, social business, robotics, internet of things [IoT], and 3D printing) for better public services and an economic boost. Rapid advances in cloud computing, connected devices, mobile, social media and data analytics are contributing to the growth of SMEs in Malaysia. SMEs constitute 98.5% of the total businesses and will spend US$2.7 billion on new technologies in 2019, according to IDC’s 2018 Small and Medium Business Spending Guide.

“The growth of digital economies is becoming an ever more impactful part of the global economy. The transition to a digital economy is a key driver of growth and development because it can provide a boost to the country’s productivity across all sectors and it creates an attractive environment for new investments from outside Malaysia. As the fourth industrial revolution becomes a key driver of the digital economy, entrepreneurs and SMEs need to assess fundamental aspects of their business, including what products and services they sell, how they deliver them to the market, the new skillsets required and how they need to organize to support their operations. Now is the time to take advantage of the new policies of the government and partner to accelerate new digital businesses,” said Randy Roberts, Research Director IoT and Telco, IDC Asia Pacific.

IDC strongly supports the new government’s plan to launch the National Fibre Connectivity Plan in 2019. This plan aims to develop broadband infrastructure to achieve a target of 30 Mbps speed per customer in rural and remote areas of the country within 5 years. This plan follows the implementation of the Mandatory Standard Access Pricing (MSAP) announcement from MCMC earlier this year that has successfully lowered broadband prices in order to connect more citizens to the digital economy.

“The high cost of a broadband connection in Malaysia has been one of the reasons small enterprises have delayed moving their business online. Government policies that improve the affordability, access and speed of broadband connectivity will increase the adoption of digital services and show the readiness of the economy to support digital initiatives” said Randy Roberts, Research Director IoT and Telco, IDC Asia Pacific.

IDC has documented examples of successful Public-Private Partnerships in the region, including Indonesia and Singapore, where the combination of public policy and entrepreneurship is driving the digital economy including smart city and mobile commerce services. In order to ensure the success of the digital initiatives in Malaysia, the government needs to consistently communicate the country’s digital priorities. The private sector should then follow with investment and development of resources in those areas, including development of key skillsets in the workforce to retain local talent.

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US-China Trade War Pushes Manufacturing To Southeast Asia

US-China Trade War Pushes Manufacturing To Southeast Asia

MANILA – Increasing tension between the USA and China has caused a diversion of manufacturing activities from China to Southeast Asia due to rising labour costs, tariffs and political instability.

In accordance to the manufacturing production index from the Japan Center for Economic Research, five key Southeast Asian countries (Indonesia, Thailand, Malaysia, the Philippines and Singapore) have a recorded 4.5 percent increase in manufacturing for 2017 while China experienced a corresponding 15.7 percent decrease. Similarly, for the first half of 2018, the Philippines’ experienced a 13.8 percent rise in its manufacturing production index due to infrastructural initiatives from President, Rodrigo Duterte’s government. A trend that was also replicated by the 4 to 5 percent rise in manufacturing by Indonesia, Malaysia and Thailand due to increased GDPs, exports and infrastructural growth.

Under newly developed China-plus-one strategies, manufacturers have been looking to tap onto manufacturing facilities in Southeast Asia before exporting to China to circumvent tariffs and increasing Chinese labour costs induced by the Trade War. A strategy that German automaker, BMW, has deployed by building some of its models in Thailand, an automotive industry hub, before exporting to China. Taiwanese power components supplier Delta Electronics also plans to re-divert its key production bases in China to Thailand by converting its Thai affiliate, Delta Electronics (Thailand), into a subsidiary while contract electronics maker, New Kinpo Group, is looking to build new facilities in the Philippines as it shifts its focus away from China. A sentiment that is shared by the group’s CEO, Simon Shen, as the company eyes a further expansion in Thailand and Malaysia due to increasing demands from clients who are looking towards Southeast Asia as a manufacturing base.

This could signal a continued downward trend in China’s lead in real GDP growth although Makoto Saito, an economist at the NLI Research Institute in Japan has said “If the U.S. economic cycle enters a downward phase in 2019, Southeast Asia could face a slowdown as well”.

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Bombardier To Focus Investments On Asian Infrastructure

Bombardier To Focus Investments On Asian Infrastructure

BANGKOK: Bombardier, Thailand’s second largest train provider, will be expanding its infrastructure investments in Asia, building upon its existing 28 offices and production sites established across the region. Laurent Troger, president of Bombardier Transportation, has said: “We will maintain our market share among the top three in the ASEAN market by providing more technology, innovativeness, service, and also customise our products to serve demand in this region”.

In particular, APAC’s urban mass transit and advanced railway networks have been identified as key areas of interest and this is evidenced by the company’s increasing supply of metro cars, trains and mainline systems across Asian cities such as Shanghai, Manila, Thailand and Singapore. Furthermore through the establishment of state partnerships with the State Railway of Thailand (SRT), Bombardier has been able to rapidly develop infrastructural projects such as the re-signaling of the full BTS Skytrain route and the implementation of its CITYFLO 450 communications-based train control (CBTC) solution. Currently, the company has also signed a prolific agreement with BTS Group to build two monorail systems worth more than Bt20 billion in Thailand and was awarded multiple contracts by the Singapore government to upgrade existing rail networks, provide auxiliary support and metro cars.

As of the end of 2017, Bombardier Transport has reported a total revenue of US$8.5 billion. This accounts for more than half of the total reported earnings of US$16.2 billion by Bombardier Group and is expected to increase exponentially due to the company’s rapid expansion plans in Bangkok, Singapore, Vietnam, Malaysia, Philippines and Indonesia. All of which comprise significant and fast growth markets within APAC which holistically represents a dynamic growth of 2.5 percent, as reported by the the UNIFE 2010 market study.

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Malaysia: An Early Adapter Of “Industry 4.0”

Malaysia: An Early Adapter of “Industry 4.0”

Malaysia: “Industry 4.0” is set to create completely new business models while improving current ones within Malaysia’s manufacturing landscape, according to GlobalData.

Malaysia is one of the world’s leading manufacturing countries per capita. The sector employed more than one million people in 2016—a significant proportion for a country of 31 million, reported the Department of Statistics Malaysia (DOSM). It also constitutes over 80 percent of all exports and 23 percent of the country’s GDP, according to DOSM and Malaysia External Trade Development Corporation (MATRADE).

“On the supply side, the industry is seeing an increase in global commodity prices and diversification from traditional low-cost production markets. On the demand side, average order value is falling, demand for customization is increasing and margins are under pressure. To address these challenges and drive evolution of a technology-driven global economy, Malaysia is preparing to launch the national policy by mid-2018,” said Dustin Kehoe, Technology Service Director of APAC at GlobalData.

Industry 4.0 introduces the “smart factory”—where cyber-physical systems monitor real-time factory physical progress to make decisions in a decentralised way. The development is driven by several factors—from additive manufacturing, autonomous robots, big data analytics, to cloud computing, Internet of Things and system integration.

Kehoe added: “In terms of technology, Artificial Intelligence (AI) will drive IoT adoption and the two technologies are converging. The integration of AI and IoT will lead to further innovation, automation and data management. Manufacturing will be among the early adopters of AI-enabled IoT.”

LVD Opens Customer Experience Centre In Malaysia

LVD Opens Customer Experience Centre In Malaysia

Selangor, Malaysia: Manufacturer of CNC sheet metal working machinery LVD has opened a new Experience Centre (XP Centre) in the Malaysian state of Selangor. According to the company, the country is a key focus as it has one of the world’s fastest growing markets with a large and advancing manufacturing base.

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