ELECTRICAL & ELECTRONICS NKEA

ELECTRONICS AND ELECTRICAL

1

The case for change

E&E important to Malaysia but with challenges going

forward
Strong heritage to build on
E&E accounts for about 41% of
Malaysias exports (2009 estimate)
Long heritage in semiconductors and
industrial electronics, emerging
strengths in Solar and LEDs
Success stories include: Intel, Agilent,
Motorola, IRIS, Silterra
Contributed to inclusive national
development, with key regional clusters:
Northern Corridor, Klang Valley, Johor
and (emerging) Sarawak

Challenge going forward is to maintain

growth and deepen value-added
Declining economic contribution: E&E
export share fell from 59% in 2000 to
41% in 2009

Increasing competition from China and

other Asian sites
Concentration on assembly leads to
lower value added
Malaysias operating environment short
of world-class; behind Singapore, on par
with China

We need to revitalize E&E

While E&E exports have grown, E&E exports have

grown more slowly than other exports since 2000
Share of Malaysia's exports
(E&E vs. others)

CAGR CAGR CAGR

Others

E&E

RM800B

(86-90) (90-00) (00-09)

664
589

600
536

604
553 22%

16%

7%

481

400

398

373
322

334

357

19%

12%

10%

34%

28%

0.4%

287
185 197

200

221

154

55
36 45
0
Source: MITI

94 104
68 80

121

86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09

E&E in Malaysia needs to move up value chain like Taiwan and

Singapore
E&E in Malaysia is concentrated in assembly

Taiwan and Singapore

concentrating on high value activities

Taiwan
Global or Reg
HQ

Semicon
Components

Malaysia

Malaysia

Global or Reg
HQ

R&D,
Design

Mfg (core
components,
device)

Assembly,
Packaging,
Testing

Low
density

Solar

LEDs

Few local players

(e.g. Epistar, Huga)

Solar

Few local players

(e.g. Motech, DelSolar)

Very few
(e.g. E-Ton Solar)
Few
(e.g. Motech,
E-Ton)

PC and
Peripherals
Consumer
Electronics
Household
Appliances

Mfg (core
components,
device)
Top 2-3
foundry players
(e.g. TSMC, UMC)
Many
Taiwan 2nd largest
manufacturer
(e.g Epistar, Forepi,
Arima, Tekcore, Huga)
Many large players;
Taiwan 5th largest
manufacturer
(e.g. Motech, DelSolar)

Focused on resistor
production 10% share of
world production

Many
e.g. Foxconn,
Acer, Compal,
Quanta, Wistron, Inventec,
Celestica, Asustek, Qisda

Assembly,
Packaging,
Testing

Many
(e.g. Flextronics, Quanta,
Jabil, Inventec, Asustek)

Many
(e.g. Inventec, Hon Hai)

Focus on higher value add,

complex manfg
(e.g. Acer, Compaq, IBM,
Apple, Packard Bell, NEC,
AST, Dell, Compal)

Sales,
Distrib,
Service
Density of
companies in
Taiwan

Many large players

(e.g. SPIL, TSMC, Amkor)

Many
(e.g. Everlight,
Lite-On, Lextar, Harvatek)

Low
density

Large players
(e.g. UL, TUV)

Mid
density

Local players expanding

capacity; some new players
(e.g. Applied Materials)

Passive
Components

Density of
companies in
Malaysia

LEDs

Many including top 2

(e.g. TSMC, UMC,
Sony, AMD)

Very few
(e.g. TSMC to set
up R&D centre)

Industrial
Electronics

Sales,
Distrib,
Service

Semi-con
components

HQ of top 2 foundries
(e.g. TSMC, UMC)

R&D,
Design

N/A for this

analysis

High
density

Minimal presence
of low value ad
activities; Labor
intensive activities
outsourced
to low cost
countries like China

LCD panel production

e.g. AUO, Chimei
Few

Mid
density

Industrial
electronics

N/A for this

analysis

Singapore

High
density

Passive
components
PC and
Peripherals
Consumer
electronics

Global or Reg
HQ

R&D,
Design

Top 3 foundry players

(e.g. TSMC, UMC,
Chartered)

3 of top 4 A&T cos

(e.g. ASE, AMKOR, STATS
Chip Pac)

LEDs

Very few
(e.g. BrightLite systems)

Few large players

(e.g. Phillips & Osram)

Very few
(e.g. Everlight Electronics)

Solar

Few but growing rapidly

(e.g. Oerlikon Solar)

Few large players

(e.g. REC, First Solar)

Many large players

setting base
(e.g. Fraunhofer ISE,
VDE, UL, SERIS)

Samsung
regional HQ

Density of
companies in
Singapore
Low
density

Mid
density

N/A for this

analysis
Many
(e.g. Murata, EPCOS)

Few
(e.g. EPCOS, Murata,
Fujitsu, Panasonic)

PC and
Peripherals

Flextronics HQ

Many
(e.g. Flextronics,
Jabil, Celestica)

HP Ink factory;
HDD mfg moving out of
Singapore

Consumer
Electronics

Flextronics HQ

Few
(e.g. Sennheiser)

Limited production or
outsource to
ODMs like Flextronics (e.g.
Panasonic, LG)

Household
Appliances

Sales,
Distrib,
Service

Large precision engineering cluster

(e.g. Applied Materials Semicon Eqpt)

Passive
Components

Source: Bain Analysis; E&E NKEA lab analysis

Assembly,
Packaging,
Testing

~40 IC design centres

(e.g. Infineon, Panasonic)

Semicon
Components

Industrial
Electronics

Current E&E focus area

Mfg (core
components,
device)

Small centres of
some large firms
(e.g. Whirlpool, Panasonic)

Minute presence
(e.g. Whirlpool)
- very small

High
density

Our target was to add $16B (RM 51Mil) in E&E GNI by

2020

Path to the target

Nominal GNI for E&E sector

$30B

15.7

26.1

Aspiration

Target (2020)

Input
Empirical
simulation

Opinion survey
(1000 person
workshop)

20

10

The E&E in 2020 Strategy:

Higher value added; larger scale; Malaysian champions7
Large Large scale, low value
add

Increase depth of
the value chain

Large scale, high value

add

E&E
2020
Electronics
today

Scale

Electrical
today

Small scale, low value

Increase scale of
domestic Electrical
sector

Small scale, high value

add

Small add
Low

High

Value add

10.4

Today (2009)

The E&E 2010 Strategy:

Focus on 4 sectors and 4 regional clusters
4 Focus Sectors

4 Regional Clusters

Semicon: Build out value chain

capabilities with fabs, design and
advanced packaging

Build regional E&E clusters in

Northern Corridor, Klang Valley,
Johor and Sarawak, leveraging
on each regions unique value
proposition

Solar: Worlds #2 producer by 2020

(from #3 in 2011)
LEDs: Light up the world
with Solid State Lighting

4X4

Industrial Electronics: Build on test &

measurement and wireless
communication clusters; expand and
strengthen other Industrial
Electronics sub-segments

RM53bn in GNI
by 2020

Fix region specific enablers and

cross-cutting enablers to create
world-class operating
environment

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices
Substrates

Idea
Generation

Components

Go To
Market

Supporting the Growth of Substrate Manufacturers and

Related Industries (EPP4)
GNI

Jobs

Investment

RM2.6 billion

3,200

RM3.5 bn

Case for change

Malaysia has a strong starting
position
- Shin Etsu: Malaysia is Shin
Etsus largest wafer production
site in the world
- MEMC: First manufacturing site
in Asia
Target
Relocate 2 silicate substrate &
wafering plant (12,000tons) to
follow the Fabs

Investment
environment

Improve investment
environment in Sarawak,
which has potential to grow as
key substrate manufacturing
site due to availability of low
power prices (negotiable) and
high quality silica

In
progress

Promotion

Targeted promotion by MIDA

to substrate manufacturers
and other related industries

In
progress

Semiconductor value chain

Global /
regional HQ

R&D, design

Manufacturing
(core
components,
devices)

Assembly,
packaging,
testing

Sales,
distribution,
services

Increasing the Number of Silicon Producers (EPP5)

GNI

Jobs

Investment

RM3.2 billion

20,000

RM13.8 bn

MIDA to promote Sarawak as

site for silicon producers

In
progress

Investment
environment

MIDA to provide incentives

(tax incentive, power rebates)
to pioneering silicon producers

In
progress

Livability

Make Bintulu (nearest town to

Samalaju Industrial Park) an
attractive livable city
Upgrade Bintulu to an
international airport

In
progress

Human capital

Enhance and align curriculum

of Sarawak universities and
Sarawak Skills Develop Centre
with requirements of silicon
manufacturing

In
progress

Promotion
Case for change
Solar PV is the strongest growing
renewable energy with 20%-30%
growth in next 30 years
Malaysia has enough resources to
supply the needed silica for Solar
and Semiconductors as well as to
export
Target
Malaysia to increase domestic
silicon production from 6kt to
115kt by 2020
Establish 1 MNC per annum and
develop 2 domestic silicon players
until 2020

Tokuyama Malaysia

Sarawak

Tokuyama Malaysia Sdn Bhd will build a polycrystalline silicon factory in the
Samalaju Industrial Park, Sarawak. Official Groundbreaking ceremony was
held on 16 February 2011.

Phase 1

Phase 2

Scheduled to begin operations in the 2nd quarter of 2013

The factory will produce polycrystalline silicon for solar cells at an annual
production capacity of 6,200 tons
Expansion plans for an additional 13,800 MT of polycrystalline silicon were
announced on 12 May 2011
The construction is scheduled to commence in April 2012 and the company
is aims to start operation in January 2015.

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices
LED Front-end
Operations
Substrates

Idea
Generation

Components

Go To
Market

Developing LED Front-end Operations (EPP8)

GNI

Jobs

Investment

RM2.7 billion

7,300

RM4.0 bn

Case for change

The LED market is growing at
more than 20% overall and looks
to continue to see such growth
going forward for the next 10-15
years
Malaysia has many downstream
SSL companies, but needs more
upstream players

Target
Bring in at least two substrate
manufacturers and/or epitaxy
companies which have high-value
add profiles
Triple LED wafer fabrication
capacity via organic growth for
current players and also through
the attraction of at least one new
global player

Promotion

MIDA to continue to attracting LED

companies to Malaysia, but with
increasing speed and attentiveness
to the needs of these companies.
Taiwan and Singapore are strong
competitors in this arena.

In
progress

Investment
environment

Good plant locations and

incentives, such as R&D/training
grants and revolving loans to
attract these companies here (e.g.
Penang Island areas)

In
progress

Supply chain

Growth in other parts of the value

chain (e.g. packaging and
applications)

In
progress

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers

Idea
Generation

Go To
Market

Growing Cell & Wafer Producers (EPP6)

GNI

Jobs

Investment

RM7.3 billion

21,000

RM10.1 bn

Case for change

Malaysias internet services are
expensive and slow
Malaysia offers a safe
environment combined with well
developed clusters
Attractive environment will
enable Malaysia to settle 1 cell
and wafer company p.a. starting
2013 to increase production
capacity to 23.3GW by 2020
Target

Talent

PSDC and SHRDC to introduce

courses/modules, in partnership
with the industry, to train talent

In
progress

Promotion

Promote Northern Corridor for

wafer and cell producers and to
provide incentives to pioneering
wafer and cell producers

In
progress

Innovation

Shared solar test centre to provide

product qualifications to lower
cost of establishing operations in
Malaysia and spur innovation
Solar R&D lab and IP house to
research thin film and crystalline

In
progress

Standards

SIRIM to establish national solar

product standard to ensure safety
and competitiveness in
international markets

In
progress

Increase production capacity by

10x from 2.4GW to 23.3GW in
2020

Perak

Twincreeks Malaysia
Twincreeks Malaysia Sdn Bhd will introduce an innovative technology,
redesigning how solar cells are designed and manufactured which
allows reduction in materials consumption by 97%. The facility will
produce 100MW solar cells, contributing a significant portion of
output to local solar farm development.

Jobs

1,000

Total investment

RM1 billion

Location

Khantan Industrial Park, Ipoh, Perak

Date of operation

Q2 2012

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers

IC Design

Idea
Generation

Go To
Market

Developing Integrated Circuit (IC) Design Firms (EPP3)

GNI

Jobs

Investment

RM3.2 billion

2,000

RM0.9 bn

Case for change

Malaysia has a small base of IC
Design firms today but has
success stories with several large
scale MNC design operations and
local design houses
IC Design strategy aligned with
Malaysias objective of high
income innovation driven
economy
Target
50 more IC design firms (from 15
today), both international as well
as local firms

Promotion

Silterra, Fab Consortium and

MIDA collaboration to identify and
encourage IC Design firms to setup
in Malaysia

In
progress

Shared
services

Electronic Design Automation

(EDA) pay-per-use centre and
shared test and prototyping lab to
lower costs and achieve targeted
certification and standards

In
progress

Training

Govt enhance support to Skills

Development Centres to train IC
Design talent

Financing &
incentives

Govt incentives to encourage

MNCs to outsource to Malaysian
IC design houses

In
progress

Infrastructure

IC Design to be included in E&E

Hub masterplan
Enhance speed and lower
broadband costs

In
progress

Centre of Excellence (CoE) for Electrical & Electronics:

IC Design
The CoE is an educational institution whose main point of focus is in Integrated Circuit (IC) Design. It
provides education through the form of short courses with the objective of aligning the E&E industry
in a competitive and innovative track, in line with EPP3: Development of IC Design Firms. Usains
InfoTech Sdn Bhd (UISB) acts as the Special Purpose Vehicle for this project

26 graduate trainees
in Advanced Digital
Design

Commenced on Jan 10
Completing in June11

24 graduate trainees
in Advanced Analog
Design

Commenced on Aug 10
Completing in Jan 12

MSc degree
by USM

Development programs
Product Development for Potential Spin-off and Nurture Local Incubator
Development of IC Design Outsourcing Program to Support Ecosystem
Promote CoE E&E Initiatives

Failure Analysis Lab

Current status
Level 1 FA lab setup
10 Companies committed with MoU Signing
Phase 1 FA Lab Shared Services launching

Done
End June 2011
End July 2011

Phase 1: Level 1 & 2 (Wafer Fab building)

Phase 2 : Level 2 & 3 (Extension building)

Phase 1: Level 1 & 2 Infrastructure ( June Update)

FESEM

CM

FIB

MCI

X-RAY

DCAP

SAM

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers
IC Design

Mature
Tech Fabs

Idea
Generation

Go To
Market

Executing a Smart Follower Strategy for Mature

Technology Fabrication (EPP1)
GNI

Jobs

Investment

RM4.2 bn

6,500

RM10.3 bn

Detailed plans
Case for change
Specialty players using mature
tech have been able to achieve
attractive ROA and are
competitive for a wide range of
applications.
Demand for mature technologies
will remain in forseable future as
they are much less capital
intensive than leading-edge
technology
Target
Setup five fabs in total by 2020,
doubling the number of fabs in
Malaysia

Financing

Training centre

First of the 5 fabs was kicked-off by

Lfoundry Malaysia
Estimated cost: US$300M-400M
Estimated size: 800,000 sq ft
Location: Kulim High Tech Park
Proposal for govt support to secure
financing syndicated with multiple
government agencies (MIDA, etc)
Also seeking private financing
QT Training Centre to be setup,
providing:
A comprehensive skill development
and training course for the
semiconductor industry
Regional equipment refurbishment
centre

Semiconductor value chain

Global / regional
HQ

R&D, design

Manufacturing
(core
components,
devices)

Assembly,
packaging, testing

Sales,
distribution,
services

In
progress

In
progress

Kedah

LFoundry Malaysia
QT Hightech Malaysia
NCIA is working with QT Hightech Malaysia in the following:
Set up of QT Training Centre in Kulim High Tech Park to provide a
comprehensive skill development and training course for the
semiconductor industry. The centre will also house a regional refurbish
centre to support refurbished equipment
Set up new wafer manufacturing facilities in Kulim High Tech Park
through the establishment of LFoundry Malaysia Sdn Bhd which is a
joint venture of QT Hightech Malaysia and LFoundry Gmbh
Official Groundbreaking ceremony was held on 20th February 2011
Construction to commence in mid June and to be completed in
December 2011.
QT Hightech Malaysia has committed RM100M investment for QT
Training Centre.

Piling works in progress

Two units of pile rig mobilised to site

RM

1.9
billion
GNI impact
RM

12
million
Investment

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Idea
Generation

Solar Module
Producers

Go To
Market

Increasing Solar Module Producers (EPP7)

GNI

Jobs

Investment

RM3.2 bn

14,000

RM7.0 bn

Case for change

By 2020 all major Asian
economies will have reached grid
parity causing a significant
demand for PV modules in Asia
Malaysia's attractive ecosystem
for module producers will make
sure that a significant share of the
modules market will be captured
Target
Bring in 2 foreign module
manufacturers and facilitate 5
joint-ventures

Polysilicon
feedstock

Ingot

MIDA to promote Johor as a site

for module production

In
progress

Investment
environment

MIDA to provide incentives to

pioneering module manufacturers
Partnership with Singapore to
attract solar investments spanning
both Singapore and Johor

In
progress

Supply chain

MIDA to attract glass producers to

Johor, which is needed for thin
film solar modules.

Promotion

Wafer

Cell

In
progress

Module

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices
LED Front-end
Operations

Substrates

Components

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Go To
Market

Developing Assembly and Test Using Advanced Packaging

Technology (EPP2)
GNI

Jobs

Investment

RM1.3 billion

1,300

RM0.9 bn

Case for change

Malaysia has high density of
assembly and test players, but
few bumping or wafer level
packaging
Natural next step is to bring in
advanced packaging; domestic
demand exists and Malaysia can
serve as global hub
Target:
Bring three advanced
semiconductor packaging
(bumping, wafer level packaging)
service providers to Malaysia

Financing &
incentives

Government incentives to
pioneering groups

Promotion

Targeted promotion by MIDA

to existing assembly and test
players to upgrade to
advanced packaging

Build on strong position in

Assembly and Test and move into
advanced packaging (e.g.
bumping)

Semiconductor value chain

Global /
regional HQ

R&D, design

Manufacturing
(core
components,
devices)

Assembly,
packaging,
testing

Sales,
distribution,
services

In
progress

In
progress

Infineon Technologies
Infineon Technologies will expand its production capacity, research &
development and to upgrade its manufacturing facilities in Melaka. The
investment will mainly increase the capacity to produce power
semiconductors for energy efficiency applications and will add 350 jobs in
Melaka.

Melaka

RM

814
million
GNI impact
RM

480
million
Investment

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

LED Packaging
& Equipment
Go To
Market

Expanding LED Packaging and Equipment (EPP9)

GNI

Jobs

Investment

RM1.4 bn

3,700

RM1.8 bn

Case for change

Malaysia has a very strong
position in LED packaging among
lighting companies that it can
grow
Malaysia has many downstream
SSL companies, but needs more
upstream players
Target
Grow packaging and application
design landscape both organically
and through inviting remaining
lighting MNCs to set up
operations here -> target is 15%
growth annually for the next 10
years

Promotion

Local contract manufacturers should

be promoted via MITI/MATRADE
overseas missions (including possible
tax incentives for foreign companies
to utilise these services)

In
progress

Investment
environment

Provide low land cost and incentives

for lighting MNCs already in Malaysia
to expand capabilities (three of the
largest global players are currently
here) and also to attract new ones
Special incentives can be given to
local companies to expand operations
prior to sector growth in preparation

In
progress

Infrastructure

Infrastructure must be prepared to

provide necessary logistics and space
for such RM&O companies

In
progress

Philips Lumileds

Penang

Philips Lumileds Lighting is investing heavily in setting up a new LED

manufacturing facility in Bayan Lepas, Penang. This state-of-the art
facility will also include a research and development centre and a
design centre, and create 300 skilled jobs.

300
Jobs created

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Local SSL
Champions

LED Packaging
& Equipment
Go To
Market

Creating Local Solid State Lighting (SSL) Champions (EPP10)

GNI

Jobs

Investment

RM1.1 bn

2,800

RM0.6 bn

Case for change

SSL companies are part of a larger
lighting market where Malaysia
has the opportunity to become a
global leader
Certification is critical to
attracting global companies,
growing local champions, and
increasing domestic consumption

Target
Grow at least 5 local SSL
companies into global champions
in technology and manufacturing
Develop a certification lab for LED
products to help ensure local and
international standards

Policies

Promotion

Human
capital

Establish pro-environmental
regulations and public awareness
(e.g. Government buildings to
move to LED lighting by 2020)
Strong IP recognition by
government to stop imitation
LED products entering Malaysia

In
progress

Assist local SSL companies in

expanding abroad via trade
delegations focusing on key SSL
related areas

In
progress

Develop LED sector talent in key

SSL applications areas (e.g.
thermals / optics) to complement
lower-cost manufacturing labour
force, utilising local universities /
institutes

In
progress

Penang

QAV Technologies
LED-SSL Certification Centre
QAV Technologies Sdn Bhd developed a light emitting diode and solid
state lighting certification centre in Penang, the first of its kind outside
the US to perform testing as per American National Standards Institute
(ANSI) standards.
Testing and certification facility for LM79 & LM80 is ready and in
operation since 1st April 2011.
QAV is currently working together with the SSL-LED Cluster, SIRIM,
Suruhanjaya Tenaga, JKR and the Lightings Technical Committee of
Malaysia in drafting the Malaysian Standards.

LM79 workstation

RM
510
million
GNI impact
6,500
Jobs created

LM80 workstation

SIRIM, JKR and the

Lightings Technical
Committee of Malaysia
visit

National Talent Enhancement Programme

In collaboration with the Human Capital Development Strategic Reform Initiative
Rationale

Objective

Fresh graduates may not necessarily be employable, as they

lack technical/ soft skills
Additionally, there may be graduates from non-E&E fields who
wish to enter E&E field, or E&E graduates who have ventured
outside of E&E but wish to re-enter
E&E industry requires skilled workforce, thus the need to
harness the above-mentioned groups

Accelerate the
development of
skilled workforce
through partnership
with industry

Target
Trainees

Target
regions

1. Fresh graduates who are not immediately employable

>2.5 GPA; or
Lack employability skills; and
Graduates in non-E&E related fields
2. Graduates who have newly entered the workforce in a non-E&E related field, but
wish to enter/ re-enter the E&E field
1. Melaka
2. Selangor
3. East Coast Economic Region

4. Iskandar
5. Penang
6. Sarawak

Focused on sectors along the E&E value chain that are green technology related in 4
existing E&E thrust, Semiconductor, Solar, Solid State Lighting, Industrial Electronics
(Electrical home appliances).

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Automation
Equipment

Local SSL
Champions
LED Packaging
& Equipment
Go To
Market

Growing Automation Equipment Manufacturing (EPP13)

GNI

Jobs

Investment

RM125 mil

1,200

RM0.4 bn

Case for change

Automation equipments are
equipments that automate processes,
e.g. robotic equipment in
manufacturing
ABB, a global leader in automation
equipment, uses Malaysia as their
Regional HQ. However, ABB only
assembles automation equipment in
Malaysia but does not manufacture
core components
Given ABBs presence, the natural next
step is for Malaysia to build
capabilities as an automation
equipment manufacturing site (not
just an assembly site)
Target
Promote Malaysia as a manufacturing
site to leading automation equipment
manufacturing

Promotion

MIDA to promote
Malaysia as a
manufacturing site for
automation equipment
to leading automation
equipment
manufacturers such as
ABB, Siemens and
Schneider

Investment
environment

Provide pioneer
incentive to automation
equipment
manufacturers to
manufacture
automation equipment
here

In
progress

In
progress

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Automation
Equipment

Local SSL
Champions
LED Packaging
& Equipment

Test &
Measurement

Go To
Market

Building a Test and Measurement Hub (EPP11)

GNI

Jobs

Investment

RM1.4 bn

7,000

RM5.9 bn

Case for change

Global electronic measurement
market will continue to grow at
~5%
Life sciences & analytical
instruments market expected to
grow, driven by continued
scientific progress
Target

Investment
environment

Grant required incentives to

Agilent expeditiously given stiff
competition from Singapore
Provide grants to local design
houses which serve the test and
measurement MNCs

In
progress

Promotion

Work with the US Govt to obtain

Government Services
Agreement (GSA)
Promote the Northern Corridor
to leading test and measurement
players and provide incentives to
attract other MNCs to Malaysia

In
progress

Shared
services

Establish shared services centres

In
progress

Grow electronic measurement

and bio-analytics business and
build complete test &
measurement ecosystem

Wireless Sensor Network

What

Sensors connected through wireless network,

Monitor the environmental, physical and chemical conditions
Emerging technology
Assist decision making process

Today
Global: US$ 44.1 b (2009)
Discreet, low processing power,
wired
Key Players: Honeywell, TI, Infineon
Malaysian: MEMS Tech (US$ 30 m)

Project committee

Future
Global: US$ 69.2 b (2013) CAGR:
9.3%
Networked, smart, self powered
Key Players: Grape Networks,
Sensicast
Key highlights: MIMOS is top
patent originator in micro energy,
Chemical & nano gas sensor
globally (Q310)

MoU signing with 3 Commercialization Partners

Terengganu (Inforence), Cameron Highland (MAFC) & Tuaran, Sabah
(Zuma Engineering)

Penang

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Automation
Equipment

Local SSL
Champions
LED Packaging
& Equipment

Test &
Measurement

Transmission &
Distribution

Go To
Market

Building Transmission and Distribution Companies (EPP 14)

GNI

Jobs

Investment

RM352 mil

400

RM0.5 bn

Case for change

Transmission & distribution
equipment refers to equipment
used to transmit electricity (e.g.
switches, transformers and
cables)
However, most high voltage
transmission equipment
manufacturing still takes place in
Europe due to complexity of the
technology
Target
Build a cluster of transmission and
distribution players in Malaysia
Set up a high voltage power lab
for testing and R&D development
facilities

Promotion

MIDA to market Malaysia as a

manufacturing location to
leading transmission and
distribution equipment
manufacturers such as ABB,
Siemens, Areva and Alstom

Investment
environment

Provide pioneer and OHQ

incentive to transmission and
distribution equipment
manufacturers

In
progress

International
test lab

Lab should partner with an intl

test lab such as CESI (Milan) or
KEMA so that certification can
be obtained for customer
acceptance

In
progress

In
progress

High Power Test Lab

Penang

What is a High Power Lab

High Power Lab can be divided into two labs namely High Voltage Lab and High
Current Lab
High Current Lab To test and simulate the test objects by means of high current
generated by current generator or obtained from the grid. The tests are short circuit
test and etc.
High Voltage Test Lab To test and simulate the test objects by mean of high voltage
generated by voltage transformer and voltage generator. The tests are high power
frequency test, impulse test, switching impulse test and etc.

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System

Devices

Substrates

LED Front-end
Operations

Components
Wireless
Communication

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Automation
Equipment

Local SSL
Champions
LED Packaging
& Equipment

Test &
Measurement

Transmission &
Distribution

Go To
Market

Wireless Communication and Radio Frequency

Identification (RFID) (EPP 12 )
GNI

Jobs

Investment

RM1.8 bn

4,400

RM0.7 bn

Case for change

RFID is a step change
technology to increase
efficiency, traceability and
security
RFID systems are expected to
slowly move towards being used
in modern applications
- ID products
- Logistics / transportation
- E-Halal Track and Trace

ID products

Develop central hub and R&D

clusters

Logistics /
transportation

Promote RFID implementation in

logistics and transportation
applications in Malaysia and Asia
Pacific market
Target countries are Thailand,
Vietnam, Laos, China, Taiwan and
various Middle East countries

E-Halal track &

trace

Develop an open end-to-end

National Halal Food track
traceability platform for JAKIM
certification consideration
Apply RFID technology in Halal
food processing

In
progress

Target
Grow radio communication
ecosystem and develop RFID
applications in Malaysia

In
progress

Penang

RFID: Logistics & Transportation

Tracking supply chain end-to-end using RFID

Manufacturer
Warehouse

Delivery

Customs
Check Point

Real-time transmission of container

logistics information
Container information
Cargo information
Logistics information
Security information of container
logistics
Time of when opening or closing the
container

Air/Sea/Land
Transport

Customs
Check Point

Delivery

Distribution
Warehouse

RFID Transport & Logistics Infrastructure 2010-2012

PB

Implemented
1. Penang Port
2. Port Klang
3. Johor Port

BKT
.

PP

.
.

NP

Future plans

KTN

.
.

BTL

WP
.

PTP

KCH
JP

KK
.

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion

System
Home Electrical
Appliances

Devices

Substrates

LED Front-end
Operations

Components
Wireless
Communication

Cell & Wafer

producers
IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Automation
Equipment

Local SSL
Champions
LED Packaging
& Equipment

Test &
Measurement

Transmission &
Distribution

Go To
Market

Building an Electrical Home Applicants Manufacturing

Hub and International Distribution Network (EPP15)
GNI

Jobs

Investment

RM1.0 billion

18,000

RM0.5 bn

Case for change

Malaysia has a fast-growing
electrical home appliances
industry with successful brands
There exists huge potential in the
ASEAN market, especially in
Indonesia and Vietnam

Target
Build a consortium company of
several Malaysian electrical home
appliances brands with a strong
international distribution network
Build a manufacturing hub to
provide base for the entire supply
chain

Investment
environment

Assistance identifying
manufacturing site which
already has or can quickly build
complete cluster of supply
chain firms
Facilitate meetings with private
investors

Build a consortium company with

an international distribution
network

Sovereign
fund
partners

Build manufacturing hub to

provide base for the entire
supply chain
Consortium
company

+
Other
domestic
companies

In
progress

Global EHA
OEMs &
ODMs

Outsource

ASEAN &
Middle East

Local supply chain

Penang

Pensonic Holdings
Pensonic Holdings Sdn Bhd will spearhead an initiative to establish a
manufacturing hub and international distribution network of electrical
home appliances (EHA) and an international distribution network. This
initiative aims to capture the rising market opportunities in the Southeast
Asian region and the Middle East.

RM
500
million
GNI impact
RM
250
million
Investment

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion
Industrial
Design

System
Home Electrical
Appliances

Devices
LED Front-End
Operations

Components

Substrates

Cell & Wafer Automation

producers
Equipment

Wireless
Communication

IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Test &
Measurement

Transmission &
Distribution

Local SSL
Champions
LED Packaging
& Equipment
Go To
Market

Industrial Design
What is Industrial Design?
Building desirability
Industrial Design seeks to compel a customer to choose a product over another
Hard and soft
Industrial Design can be broadly categorised into "hard" and "soft" aspects
"Hard" aspects is about the Engineering which appeals to the logical conscious
part of customer choice - Features, Technology, Quality, etc
"Soft" aspects are about Emotion, appealing to the unconscious part of customer
choice Colour, Sound, Look, Feel, etc

Component design &

manufacturing

Systems Design &

manufacturing

Product Design &

manufacturing
EPP10: Develop Local SSL
Champions

MDeC is conducting a feasibility study on Industrial Design Centre of Excellence for Electrical &
Electronics.

Electrical & Electronics Value Chain

Value
Add

BOM
Explosion
Cross-cutting enabler: Industrial Park Safety

System
Home Electrical
Appliances

Devices
Industrial
Design

LED Front-End
Operations

Components

Substrates

Cell & Wafer Automation

producers
Equipment

Wireless
Communication

Industrial
Design

IC Design
Mature
Tech Fabs

Solar Module
Producers

Advanced
Packaging
Idea
Generation

Test &
Measurement

Transmission &
Distribution

Local SSL
Champions
LED Packaging
& Equipment
Go To
Market

Industrial Park Safety

Objective
To respond to incidents such as mass casualties, major chemical
accidents, bio-terror attacks & disastrous contaminations.
HAZMAT (Hazardous materials) vehicle NATO-Standard Incident
Room, decontamination units and detection systems. Stationed
within 20min of park.
MDERS (Mass Decontamination and Emergency Response Systems) is
designed to have the mobility to provide the first line of emergency
treatment, decontamination and emergency supervision. The MDERS
at Kulim Hospital is the 1st in SEA.

First Responder: HAZMAT vehicle

Follow Up: MDERS

Increases the
appeal of
industrial parks
to potential
investors