LEADING global developer, manufacturer and supplier of high-end vacuum valves, VAT Group AG, has officially ushered in its upgraded Malaysia manufacturing facility in Batu Kawan, Penang.
As of last year, the company had invested more than RM165 million in plant and equipment in Batu Kawan.
In 2013, VAT Manufacturing Malaysia opened a 6,000sq m facility in Penang – it was its largest ever capital investment to expand production, and its first vacuum valve manufacturing factory outside of Switzerland.
VAT Group AG chief executive officer Mike Allison said the size of the VAT plant in Penang had quadrupled since they first started production in 2013.
“We have expanded from 6,000sq m to the current 24,000sq m.
“Our ambition is for VAT in Malaysia to account up to 30% of our total global production capacity by next year (2020) and to be the primary sourcing hub for our key customers in South Korea, Japan, China and other parts of Asia.
“VAT in Penang has become our major base for serving our most rapidly growing market with our latest technology innovations and fast local service,” he said in his speech during the VAT Manufacturing Malaysia Phase Two opening ceremony in Batu Kawan today.
Later during a press conference, Allison commented on the trade war between the United States and China.
“The Swiss companies pride themselves in being neutral. We are very neutral, we work closely with everybody, we support free trade and we have tremendous partnerships with all countries around the world.
“I think Malaysia can also be a neutral player in the hi-tech industry.
“When you decide to set up a factory, it is better to be in a ‘neutral’ location because you do not want to be seen as bias.
“Malaysia has a fantastic opportunity to leverage that; not just because of the trade war, but to be in a ‘neutral’ location that supports free trade, provides the best cost and having the availability of (skilled) labour.
“What you (Penang) are doing and the public-private partnership in education should be very good for the country. It (Penang) is a great location,” he said.
Allison said Singapore had become too expensive and too difficult for land acquisition at some point.
“Many of our customers had set up facilities in Singapore. Singapore is becoming too expensive and too difficult for land acquisition at some point.
“We have a lot of requests from our key customers, peers and partners who are looking at potential locations. They are very interested in what we are doing here (in Penang). Of course, we have been giving them very positive recommendations,” he said.
VAT Manufacturing Malaysia managing director Bernd Kirchhoefer said the company looked at the different regions in Southeast Asia and Asia back in 2010 and 2011.
“In the end, it was positive for Penang because of its talent pool. Penang has the infrastructure, and the highly-skilled people whom we can work with,” he said.
The Charge d’Affaires from the Embassy of Switzerland in Malaysia Werner Bardill congratulated VAT for the auspicious occasion.
Chief Minister Chow Kon Yeow said over the years, Penang had received many inquiries from interested and potential investors.
“We have moved away from low-cost manufacturing. We are focusing on hi-tech research and development.
“We welcome industries that can fit into our focus area to establish their facilities here. Besides looking for new investors, we also welcome re-investments from existing investors,” Chow said.
He said that it was harder to win new investors than to encourage existing investors to re-invest.
“New investors would take about two to three years before making their decision to invest in a particular location. They would check out various locations, do some in-depth study and shortlist their choices before coming to a decision. The process is lengthy,” he told a press conference.
Earlier in his speech, Chow said Penang through investPenang, had been consistently evaluating and seeking high quality and sustainable investments.
He was thankful to the Malaysian Investment Development Authority (MIDA) and the Ministry of Finance which approved the incentives.
“Penang has recorded RM9.2144 billion of total approved manufacturing investment in Malaysia in the first half of this year.
“Encouragingly, Penang contributed 35% of Malaysia’s total manufacturing FDI for the first half of 2019. It is the highest among the states.
“Penang’s FDI for the first half of 2019 (RM8.7 billion) has surpassed the full year FDI of RM3.7 billion in 2018,” Chow said.
Referring to the Penang2030 vision, he hoped that both the public and private sectors would work hand-in-hand in achieving the vision of upgrading the economy.
Also present were Batu Kawan MP P. Kasthuriraani, Bukit Tambun assemblyman Goh Choon Aik, investPenang chief executive officer Datuk Loo Lee Lian, VAT Group AG SEMI business unit head Urs Gantner and VAT Group AG display/solar business unit head Jurgen Zoller.
Story by Christopher Tan
Pix by Ahmad Adil Muhamad
Video by Darwina Mohd Daud