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Home Business RealEstate

Malaysia-tops-cw-manurfacturing-index

The FINANCIAL by The FINANCIAL
August 12, 2015
in RealEstate
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The FINANCIAL — Malaysia has retained pole position in global real estate adviser Cushman & Wakefield’s 2015 ‘Where in the World? Manufacturing Index’.

Published on August 11, the report reveals how the region is benefitting from a lower cost business environment which is proving attractive to manufacturers.  The result also underpins the dominance of the ‘APAC powerhouse’ with the region this year securing seven places out of the top 10 within the main index.

Richard Middleton, head of occupier services in EMEA and Asia Pacific, commented: “The markets of Asia Pacific continue to remain particularly attractive to manufacturers and this shows in our latest index rankings. Malaysia has retained top place in our main index for the second year running and Vietnam tops our growth index and is maturing as a manufacturing destination.

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“From a broader perspective, there remains some volatility at play. While China remains the world leader in terms of manufacturing output and benefits from the scale of its immediate marketplace, rising labour costs have caused a shift in strategy for some manufacturers. This has not only benefitted the APAC regions of Malaysia and Vietnam but has also added to a re-shoring trend with a number of manufacturers moving their plant and facilities back to Western markets. This has strengthened the prospects of certain European locations, notably Turkey which has positioned itself at the crossroads of Europe, Asia, Russia and Africa.”

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Following a less successful period for US manufacturing, many assumed that its market was in a state of irreversible decline. However, a re-shoring trend among manufacturers and a stronger energy platform has resulted in the US ranking in 4th position, up five places since 2014.

Mark Wanic, Cushman & Wakefield’s head of occupier services in the Americas, said: “There is a genuine sense that manufacturing is now making a comeback in the US as global demand appears to have turned a corner. The cost differential to cheaper markets, which contributed to a number of manufacturers moving ‘off-shore’, has now narrowed –with the US regaining a competitive edge.

“A more competitive energy platform, both in terms of cost and security, is adding to the US as a manufacturing location.  In addition, supply-chain management is also collectively adding to the more positive outlook evident from our latest index ranking.”

As consumer tastes develop for more customised products, manufacturers face an ever pressing need to respond quickly to new trends and ensure products are delivered expediently to their customers. Increasingly, location selection is all about being able to better serve and reach customers as quickly as possible.  It is critical to weigh up individual market conditions, risks and costs as part of any relocation or expansion strategy and the report acts as a barometer for this and can be tailored to an individual’s requirements.

 

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