I recently spent a week in Malaysia exploring the country’s metal cutting industry. The country’s natural beauty and sights were captivating, but I was just as enthralled by its manufactured sites – and the opportunities they presented for AMT members.
My week began in Penang, “The Silicon Valley of the East.” Since the 1970s, Penang has served as one of the first offshore locations for major American semiconductor companies like Intel, AMD, and Hewlett-Packard. Penang continues to receive billions of dollars in investment in this industry, a significant portion of which is invested in the machine tool industry for the high-precision machining of wafer fabrication equipment, automation and robotics, metrology and inspection, wafer dicing and finishing, tooling, consumables, and more.
My first stop was the Penang Skills Development Centre (PSDC), where I was hosted by its CEO, Dr. Hari Narayanan, and his senior team. You might wonder how the Penang area, with a population of only 1.8 million, could become a major player in one of the world’s most important industries. One of the foundations of this success is the training provided by PSDC, which is guided by a management council comprised of top-line executives from major international companies with a local manufacturing presence. The majority of the companies are U. S. companies.
Many AMT members are already involved with PSDC through cooperative projects involving machinery, tooling, training, software, and more. PSDC is always looking to advance its manufacturing knowledge through sustained partnerships, and AMT is happy to facilitate introductions and meetings for any interested members.
Next, I was hosted by InvestPenang, a non-profit agency of the Penang state government responsible for attracting and facilitating new investment in the city. Since manufacturing comprises 24% of Malaysia’s GDP, much of this investment also represents an opportunity for our members. The top investment targets are electrical and electronics, medical devices, aerospace/avionics, and precision engineering and equipment.
A top priority for InvestPenang is the city’s diversification into medical device manufacturing, as demonstrated by Smith+Nephew’s $100 million factory opening in 2022 and Dexcom’s investment of $600 million to begin production in 2024. Rumor has it that another U.S. medical company will soon announce a new and sizeable investment.
InvestPenang’s tagline is “Invest—Work—Live—Play,” and I would still be on one of Penang’s lovely beaches sipping a cold beverage if I were not compelled to take a one-hour flight to Kuala Lumpur for my next field marketing expedition.
With over 18,000 attendees, Metaltech, Malaysia’s largest metalworking exhibition, takes place every May in Kuala Lumpur. The exhibition is held at MITEC, a gleaming new exhibition center only 15 minutes from the city center’s affordable and luxurious five-star hotels. One or two days is enough to gauge the industry landscape, and English is widely spoken, so visitors can gather firsthand knowledge. Over 60 AMT members were represented directly or through distribution partners, and most of the management staff in attendance were regional.
The Johor-Singapore Special Economic Zone (JS-SEZ), launched in early 2025, will be a key driver of growth. One of the main goals of this development is to move manufacturing out of Singapore and across the strait into Malaysia. Many of the employees working in manufacturing in Singapore are Malaysian. As one of the Malaysians I met at the exhibition explained: “I am one of the 250,000 Malaysians that cross over the bridge into Singapore every day, so the JS-SEZ is going to be a big improvement in efficiency for the factories and also lifestyles for the employees.”
This will also drive many new investments in expanded and upgraded manufacturing capacity.
For more information, please contact Mike Lauer at mlauer@AMTonline.org.
