DHL Supply Chain to invest RM654.46m in Malaysia
17 Oct 2023
DHL Supply Chain, the global market leader for contract logistics solutions, plans to invest €350 million (RM1.75 billion) in South-east Asia with more than a third of the investment or €131 million to flow into Malaysia over the next five years.
Of the €350 million, DHL Supply Chain will allocate €104 million in Singapore, €80 million in the Philippines, and €35 million in Indonesia to expand its warehousing capacity, workforce and sustainability initiatives.
DHL Supply Chain South-east Asia chief executive officer Andries Retief said there is a global reshuffle of supply chains and Malaysia will benefit from it, especially in the manufacturing sector.
“A member of Asean, the country is party to numerous free trade agreements, making it an attractive option for those looking to diversify their sourcing options.
“This is why we are investing €131 million to ensure that we have the capacity and talent to support our customers’ growth here,” he said during a media briefing here today.
To an already strong presence in Malaysia, DHL Supply Chain will introduce two new facilities in Penang and one each in the central and southern regions. These new builds will add 113,000 square meters (sq m) of warehouse space to its existing portfolio of 217,300 sq m.
Part of the multi-million euro investments will be directed to the implementation of advanced automation at the upcoming Penang Logistics Hub 5 (PLH5) in Bayan Lepas, Penang.
Meanwhile, DHL Supply Chain chief executive officer Oscar de Bok said there is an incredible opportunity for businesses in South-east Asia to strengthen supply chain resiliency as companies are looking at diversifying supply chains.
“South-east Asia, with its efficient work environment and effective trade agreements such as the China-Asean Free Trade Agreement (FTA), stands to benefit the most.
“Our multi-market investment of €350 million in this region complements our global investment strategy.
“These are strategic investments, despite the generally softer market environment, because we invest in the future growth of our business and strongly believe in the strategic expansion and diversification of our regional businesses,” he added.
He said Malaysia is a very interesting market and Penang specifically has good market potential due to its geographical and strong foreign direct investment perspectives.
“We see substantial growth in all three regions. That is why we split (our investment) over different areas,” he said.
The company will also continue to invest into its warehouse management systems (WMS) and digitalisation initiatives, such as the state-of-the-art automated pallet storage and retrieval systems (ASRS) and GTP (goods to person) robotics technology, which will be featured in its new warehouse facilities.
The logistics solutions provider aims to expand its transportation capabilities in Malaysia with significant investment in its fleet, systems and people, with its first Connected Control Tower in Kuala Lumpur. It aims to create 450 jobs in 2024.
It is also committed to carbon-neutral facilities for all new buildings. All its facilities in Singapore and Malaysia have achieved carbon neutrality, underscoring its leadership to champion sustainability in the supply chain sector.
Other sustainability initiatives include the recent integration of Smart LED lighting and solar panels across 100,000 sq m of its integrated logistics centre warehouse in Malaysia.