British technology company Dyson will invest £2.75 billion (S$4.93 billion) on developing new technologies, with parts of the investments to be utilised on building an advanced manufacturing hub in Singapore, said the firm on Friday (27 November).
Dyson, renowned for its home appliances, aims to double its product portfolio in the next five years and venture into new fields of innovations including machine learning and robotics, as reported by Financial Times.
The company said it would prioritise the commercialisation of the solid-state battery technology it was developing for an electric car project that its namesake founder James Dyson had abandoned last year.
The investments are set to be channelled across Dyson’s operations in Singapore, where it would open a new global headquarters next year, the United Kingdom (UK), and the Philippines.
Dyson also intends to expand its research and development facilities in the city-state, and establish a new university research programme there.
It will build a new software hub in Alabang in the Philippines, while in the UK, Dyson said it would boost its investments at both of its campuses in Wiltshire.
“Now is the time to invest in new technologies such as energy storage, robotics and software which will drive performance and sustainability in our products for the benefit of Dyson’s customers,” said Dyson’s chief executive officer Roland Krueger.
“We will expand our existing product categories, as well as enter entirely new fields for Dyson over the next five years. This will start a new chapter in Dyson’s development,” he added.
Why is Dyson moving its HQ to S’pore?
It was reported last year that Dyson has secured a new global headquarters building in Singapore at the historic building St James Power Station.
Jim Rowan, the former CEO of Dyson, stressed that the move to the city-state was not due to the UK’s tax regime or Brexit, but because the company wants to be “future-proof for where we see the biggest opportunities”.
“We have seen an acceleration of opportunities to grow the company from a revenue perspective in Asia,” Rowan told WIRED. “We have always had a revenue stream there and will be putting up our best efforts as well as keeping an eye on investments.”
But there’s more to that.
WIRED’s report highlighted that Singapore and the European Union had not only signed a Free Trade Agreement (FTA), but they also signed an Investment Protection Agreement in October 2018 and a framework agreement that will drive closer partnership and cooperation.
The news report quoted, “Come Brexit Day on March 29, should there be a ‘no deal’ scenario, it will be easier to trade with the EU if you’re a Singaporean company, rather than a British outfit.”
Linda Lim, an economist at the University of Michigan, told WIRED that companies that locate their headquarters in Singapore will get tax incentives and benefits from the city-state.
“A case in point is the US semiconductor company Broadcom, which had its global HQ in Singapore, while basically the vast majority of the leadership was in the US,” she noted.
Ms Lim believes that “the most critical motivator” to Dyson’s move is the investment incentives offered by the Singaporean government. These incentives include tax breaks, various subsidies – such as grants for research and development – state equity investments and loans, she said.
“These have not been and may not be disclosed, but given Singapore’s many disadvantages as a manufacturing location especially for automobiles, I can’t imagine that Dyson is investing there without some such incentives,” she added.
Meanwhile, an economics professor at Kingston University, Steve Keen, opined that Dyson’s motive of moving its HQ to Singapore is likely due to the skills shortages in the UK.
“There’s also a marketing angle. A Ford EV is ‘meh’ next to a Tesla, because of Musk’s justified image as an innovator. A Dyson is just as Wow! on that front as a Tesla, given Dyson’s reputation as an innovator,” he added.
Mr Keen continued, “Finding the engineers to implement a new design should be much easier in Singapore than in the UK.”