Dyson Ltd, famous for making vacuum cleaners, picked Singapore to manufacture its first electric car, pushing ahead with plans to challenge Tesla Inc in the hottest sector of the automotive market.
The closely held British manufacturer yesterday said it will complete the factory by 2020 and stuck to a goal of rolling out its first model by 2021 as part of a ￡2 billion (US$2.6 billion) effort to expand into automobiles.
The choice of Singapore — which does not have a single car-manufacturing plant and is one of the costliest places in the world to buy an automobile — comes as Tesla zeroes in on establishing a factory in China.
The decision is a victory for the city-state, home to the planet’s second-largest container port and a manufacturing hub for high-technology products such as Rolls Royce Holdings PLC aircraft engines.
Dyson is among new contenders entering the race to make electric vehicles, which are gaining market share from gasoline-powered cars.
Besides Tesla, Dyson would compete with global giants, such as Daimler AG, Volkswagen AG and General Motors Co, that are all charging ahead with electric vehicle plans.
Singapore, with fewer than 6 million people, is a minor market itself, but has technology talent and strong intellectual-property (IP) protections, regularly topping regional IP rankings.
Dyson already has a manufacturing hub in Singapore that focuses on digital motors, with the company employing about 1,100 people in the region.
The country also has a free-trade agreement with China, the world’s largest market for electric cars.
While Tesla last week took a step toward building a car plant in Shanghai, Dyson’s founder, James Dyson, has complained about IP theft in China.
China is to remain the top electric-vehicle market at least until 2040, when more than half of all new car sales and one-third of the planet’s fleet — equal to 559 million automobiles — is to be electric, according to a forecast by Bloomberg NEF.
James Dyson said the company’s “center of gravity” has tilted toward Asia, which last year generated almost three quarters of revenue growth.
“The decision of where to make our car is complex, based on supply chains, access to markets,” Dyson chief executive officer Jim Rowan said in a note to staff.
“The availability of the expertise” would help the company achieve its ambitions, he said.
Dyson had considered the UK and various Asian locations for its car facility.
It has extensive manufacturing experience in Malaysia and previously made products in the UK, which might lose some of its allure for global companies with the planned exit from the EU.
Dyson is to build the plant itself rather than subcontract the work out to suppliers.
Tesla has been going through what founder Elon Musk has called “production hell,” followed by “delivery logistics hell,” as the company has been ramping up volumes at its sole car factory in Fremont, California.
Exactly what type of cars Dyson would be producing remains to be revealed.
Construction is still ongoing at its test facility at Hullavington, England.
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