Dyson is moving its headquarters to Singapore
Dyson has announced that it is moving its headquarters to Singapore from Malmesbury in Wiltshire.
The move by the appliance maker means two executives will relocate – chief financial officer Jorn Jensen and chief technical officer Martin Bowen.
Other work at Malmesbury will not be affected and no jobs will be lost.
Chief executive Jim Rowan said it was not to do with Brexit or tax but added: “It’s to make us future-proof for where we see the biggest opportunities.”
He added: “We have seen an acceleration of opportunities to grow the company from a revenue perspective in Asia. We have always had a revenue stream there and will be putting up our best efforts as well as keeping an eye on investments.
“We would describe ourselves as a global technology company and in fact we have been a global company for some time. Most successful companies these days are global.”
British bases
Dyson already has a presence in Singapore and in October announced plans to build its new electric car in its new factory there.
Most of its products are designed in the UK, but manufactured in Asia.
The company was keen to stress that it will still be investing money in its British bases.
Mr Rowan said it would be spending £200m in new buildings and testing facilities in Hullavington, and £44m in refreshing office space and adding new laboratories in Malmesbury as well as investing £31m for the young undergraduates at its university on the same site.
“Malmesbury has been the epicentre for us and we will continue to invest all over the UK,” he added.
“The tax difference is negligible for us,” added Mr Rowan, who confirmed that the company would be registered in Singapore, rather than in the UK.
“We are taxed all over the world and we will continue to pay tax in the UK.”
Analysis:
By Theo Leggett, BBC business correspondent
Dyson’s Chief executive Jim Rowan said today he would describe the business as a global technology company.
However, because its roots are in Britain and its founder Sir James Dyson has been a vocal supporter of Brexit, the decision to move its headquarters to Singapore is likely to make political waves.
In practical terms, the change is a minor one. Two senior executives will be transferred to the Singapore office, where the company itself will now be registered.
There will be no impact on its 4000 workers in Britain, and according to Mr Rowan, little impact on its tax affairs either. In 2017, it paid £95 million to the Exchequer.
It will continue to invest in its UK research and engineering sites in Malmesbury, London and Bristol, as well as a new centre in Hullavington, where it plans to develop a ground-breaking electric car.
But the change is still highly symbolic.
How Singapore sucked in James Dyson
A growing Asian market and fears of Corbyn drew the inventor to the east, writes John Arlidge
Sir James Dyson, with his wife Deirdre, plans to produce electric cars in Singapore
PAUL COWELL
Pioneer Crescent: Sir James Dyson could scarcely have chosen any other street on which to build his factory in Singapore. Raindrops the size of gobstoppers pounded the roof on a recent visit, forcing Hengky Wirawan, the plant’s leader, to shout to make himself heard as he showed off the production line.
“If you have a vacuum cleaner or hairdryer, the motor will have come from here,” he yelled. “We make one every 2.6 seconds.” Dyson keeps a close eye, even from his Gloucestershire estate. The factory floor is “live and connected to an app, so if James wants to look at it, he can,” said another staffer, Pinky Leong.
The billionaire inventor will soon be keeping an even closer eye on the Singaporean part of his empire. Last week he announced plans to move his headquarters from Malmesbury in Wiltshire to the city state. It is part of an estimated £1bn investment that will also see Dyson open the first car plant there for a generation to make his new electric car.
Critics lined up to accuse the arch-Brexiteer — who advocates a no-deal split from Europe — of fleeing the chaos the threat of no deal is creating just weeks before Britain is due to leave the EU. Labour MP Wes Streeting accused him of “rank hypocrisy”, saying he had “no sense of responsibility” to his country.
Company insiders concede Dyson is disappointed Theresa May’s compromise deal will, if approved, make it harder for Britain to negotiate comprehensive new global free trade deals. But they insist he is far more concerned by the possibility that Jeremy Corbyn might emerge from the morass as prime minister. “A general election is not out of the question, nor a Corbyn victory, and James and Jeremy Corbyn have diametrically opposed views on business,” said one staffer.
Dyson, 71, also wants to make sure that, as he takes his biggest gamble — he is betting £2.5bn that he can make the first upscale electric car using solid state batteries — he is doing it in a region that has the biggest market for electric cars, and where most of the essential components are made. His company, which turns over £4.4bn and employs almost 9,000 people worldwide, will do much of the R&D for the car in Wiltshire, “but it would be stupid to think we could build our own automotive manufacturing plant while our management sat 7,000 miles away,” Dyson said.
Some are not surprised by his Asian takeaway. Dyson, who has a £9.5bn fortune and whose firm last week reported record annual profits of £1.1bn for 2018, has not hidden his admiration for Singapore. In a recent interview with The Sunday Times to coincide with the factory visit, he praised its support for manufacturing, technology and education and the global outlook of ministers. It is an “exciting, ambitious” nation “unapologetically focused on global trade and the future . . . from which Britain can learn as we chart our new course in the world”.
The tycoon has been investing in Singapore for more than a decade, sinking almost £500m into two manufacturing and research plants. Over 1,000 people work for Dyson there, and that number will rise to 2,000 when the car factory is completed. Only a handful of executives will transfer from the UK in the headquarters move.
Dyson sees similarities between Britain and Singapore. Each is small, with a highly educated population. That means they lack the scale to compete in mass production. Nor can they compete on price because brainy workers are expensive. But both can win in hi-tech sectors, such as complex engineering, pharmaceuticals and financial services.
That’s what Dyson calls the Singapore dream — and, whatever you think about a city with an authoritarian government, little free expression and an aversion to chewing gum, the dream has become economic reality. Two centuries almost to the day after Stamford Raffles landed and founded what became the modern city state, Singapore is growing so fast it is beginning to eclipse Hong Kong as Asia’s business capital. GDP growth is rising to $57,714 per head, compared with Hong Kong’s $46,194, the World Bank says.
Dyson is one of several British investors living the Singapore dream. Rolls-Royce’s second-biggest aero-engine plant, after Derby, is on the site of an old colonial British army barracks near Changi airport. By coincidence, Warren East, Rolls-Royce’s chief executive, sits on the board of Dyson, as a non-executive director. Bicky Bhangu, who runs Rolls-Royce Singapore with 2,500 employees under him, is investing in technology to increase production and servicing of his company’s Trent engines and will transfer the technology to the Midlands.
“We’re developing smart manufacturing, robotics, automation and 3D printing before deployment to Derby,” Bhangu said, as he looked out over the engine testing chamber whose walls are made from 1m-thick reinforced concrete.
Encouraged by the success of Dyson and Rolls-Royce, global tech giants Google and Alibaba are moving in, making Singapore the most important regional tech hub outside China.
British banks are investing heavily. Financial services in Singapore received record overseas investment in 2017 — £4.73bn. Bankers are attracted by the growing ranks of crazy rich Asians. Singapore is home to the third-largest number of multi-millionaires, according to analysts at GlobalData WealthInsight.
How has this tiny speck of a city, once so dull it was nicknamed the Isle of Wight of Asia, become so attractive to world-beating businesses? The government invests heavily in the hardware and software of the city, much as Dyson does in his products. Ministers are behind the expansion of the free port that Dyson will use to export his cars to China, and the construction of two new terminals and one new runway at Changi in half the time it has taken Heathrow to get first-stage approval for a third runway.
The government also backs Singapore’s people. Its schools and universities turn out one of the world’s most highly educated workforces, especially in engineering. “The quality you can achieve with the graduates here and the speed with which you can achieve it” makes it worth paying the high wages they command, Dyson said.
The government keeps taxes low. Corporation tax is 17% but can be cut to 8.5% with exemptions and incentives. Dyson won’t comment on what breaks he gained, but the company said the change in its bill would be “negligible”. There is zero tax on capital gains and dividends.
Dyson has taken steps to mitigate his tax bill in the past. He has amassed 33,000 acres of agricultural land, making him a bigger landowner than the Queen (farmland is exempt from inheritance tax). And he has put money into several tax-deferral film investment schemes.
Geography favours Singapore. It is a member of the Asean trade bloc, which has a free-trade relationship with China. That was part of the draw for Dyson. Being near China — but not in it— is politically attractive, too.
Weak trade unions and the stability that one-party rule guarantees also help to lure investors. The centre-right People’s Action Party has dominated Singapore’s politics since independence from Britain in 1963. Prime minister Lee Hsien Loong has been in power for 15 years.
Softer factors include the rule of law, the English language, no corruption, low pollution and what Loh Lik Peng, a former lawyer who is now the city’s best-known hotelier and restaurateur, calls “a new ‘can do’ spirit. Thirty years ago everyone wanted to be a professional. Now it’s about being an entrepreneur.” There are some clouds on the horizon, though. China’s belt and road initiative threatens Singapore’s port. Debt is high — 114.3% of GDP, the International Monetary Fund says. The trade war between America and China threatens growth. The population is ageing and immigration falling. Income inequality is rising. The film Crazy Rich Asians was a tasteless joke to locals who struggle to make ends meet. There are even hints of political unrest, mainly on social media.
But these problems will be swept aside tomorrow when prime minister Lee launches the Light to Night festival to kick-start Singapore’s year-long bicentenary festivities. He will recall the aspiration of his father, the late Lee Kuan Yew, the founder of modern Singapore, that it should become the “Boston of the East”. Dyson’s decision suggests it already has.
Additional reporting: John Collingridge
Great ideas, shame about the engineering
When they arrive at Dyson’s Wiltshire campus, recruits are handed a copy of its founder’s autobiography, Against the Odds, writes Liam Kelly.
The ritual gives a glimpse of what former workers at the vacuums-to-hairdryers empire describe as the “cult of personality”.
Sir James Dyson, 71, has become a business hero since he left the Royal College of Art in the 1970s and developed a wheelbarrow with a red plastic ball at the front. An estimated 67m homes around the world now own one of his products.
With fame and power has come a quirky corporate culture. A cadre of middle managers “second-guess what they think James would like, and do things in his name”, said a former manager. Teams are discouraged from communicating and the company is “unusual and inward-looking”, he added.
Dyson is still involved with all products. “It’s really cool, because you get to have meetings with him,” said a former engineer. “But also kind of annoying, because it’s really hard to make decisions unless James Dyson makes them.”
One former employee described the man known as JD as “like a nice old grandad”. Another engineer who attended product meetings described Dyson as “friendly and approachable”, adding that he “didn’t dominate the conversation at all”.
Not all workers think they are in the presence of an engineering genius. “He’s a great ideas man,” said one. “I don’t think he’s a great engineer. Engineering is about getting the final solution with the smallest number of steps.”
Dyson famously took 15 years — and 5,127 attempts — to make his first bagless vacuum cleaner.
