Latest news with #RM6.1bil
The Star
25-06-2025
- Business
- The Star
RM6.7bil investment boost for Penang in first quarter
79% of investments in Penang are directed to the electrical and electronics sector. — Filepic PENANG has recorded RM6.7bil in approved manufacturing investment in the first quarter of the year, Chief Minister Chow Kon Yeow says. He said the state continued to show resilience and competitiveness as a leading investment destination amid global uncertainties and persistent trade tensions. 'The RM6.7bil secured in approved manufacturing investments represented 22% of Malaysia's total. Penang is the second highest contributor among all states. 'The investments stem from 36 approved manufacturing projects and are expected to create 4,577 new job opportunities, further strengthening Penang's position as an economic powerhouse,' he said during a press conference at Komtar. Of the total investments, Chow said 90%, or RM6.1bil, came from foreign sources. This, he said, reaffirmed Penang's position as a trusted global hub for advanced manufacturing and innovation. He added that the breakdown further reflected the state's industrial strength, with 79% of the investments directed to the electrical and electronics (E&E) sector and 15% to machinery and equipment. Chow says the investments in Penang underscore continued trust from the world's leading technology players. Chow noted that the United States led foreign investments with RM2.4bil, followed by Hong Kong (RM1.3bil) and Taiwan (RM1.1bil). The Padang Kota assemblyman said he remained optimistic about Penang's medium-to-long-term investment prospects, despite the uncertainties caused by US tariffs. 'InvestPenang, the state's investment promotion agency, continues to receive strong interest from global investors, both for new investments and reinvestments in Penang. 'We are currently filtering through these investor enquiries and hope they will yield positive results once due diligence is completed. 'This sustained interest echoes Penang's strong performance in 2024, with Singapore (RM4bil), the United States (RM2.9bil) and Taiwan (RM2.1bil) ranked as Penang's top investing economies,' said Chow. This, he noted, underscored continued trust from the world's leading technology players. He said the upward momentum was the result of Penang's consistent focus on building a resilient, innovation-driven economy. 'Our strategic positioning in the global supply chain is strengthened by the alignment of forward-looking policies, industrial infrastructure and a highly skilled talent pool. 'While we continue to excel in manufacturing, Penang is now advancing into high-value domains such as integrated circuit design, advanced packaging as well as precision equipment manufacturing to support the National Semiconductor Strategy. 'At the same time, we are nurturing emerging sectors, including medical technology and global business services to ensure broader, more sustainable growth,' he said. Chow said Penang remained firmly committed to unlocking new frontiers of economic opportunity. 'Our priorities are clear – to cultivate innovation, empower our workforce and build a resilient ecosystem that welcomes high-impact, transformative investments,' he added.
The Star
09-05-2025
- Business
- The Star
Why are fashion labels ending discounts in China? Can this rebuild brand value?
Some luxury labels are pulling back from steep markdowns in China, seeking to rebuild an image of exclusivity to lure back wealthy shoppers whose spending remains less affected by economic slowdown. None of the products sold by Kering SA's Balenciaga on Tmall, China's dominant e-commerce platform, were discounted in the first quarter of this year – or even during China's biggest annual online shopping festival in November – according to data consultancy Re-Hub. That's a marked contrast to the brand's average discount of about 41% on Alibaba Group Holding Ltd's-owned Tmall during the same periods the year before. Versace, set to become part of Prada SpA after a US$1.4bil (approximately RM6.1bil) acquisition, cut prices for an average of just 3% of its products on Tmall in the first quarter, compared to 12% in 2024 – and the discounts weren't as steep. Italian luxury house Valentino Fashion Group SpA also lowered the number of discounted products available on Tmall for January, and pulled markdowns entirely in February and March. The avoidance of discounts, which appear counter-intuitive given the market's sluggish demand, marks an about-turn in luxury labels' strategy in China. "It's a move from chasing traffic and short-term revenues to cultivating long-term brand affinity,' Re-Hub's chief executive officer Max Peiro said. "This shift is not merely operational-it's foundational. Brands are investing in relevance, desirability, and premium experiences to foster long-term loyalty.' Read more: Stakes are high for luxury fashion, as brands reshuffle their head designers Discounting is proving less effective in driving sales growth and risks undermining brand value, he added. Even the most exclusive premium fashion houses – including Hermes, Chanel and Louis Vuitton, which have typically eschewed online discounts – are stepping up efforts to maintain their exclusive images among wealthier Chinese, including offering more VIP-only events and shopping experiences like in-store museums. The pivot away from discounts comes as global fashion houses reshape their strategies in China, where a decades-long luxury boom driven by the middle class is coming to an end as a persistent property slump and anemic post-Covid economic growth turns once-spendthrift Chinese shoppers into cost-conscious bargain hunters. The country's middle class – a pillar of the world's luxury market – is turning to athleisure and cheaper dupes of the luxury brands it used to covet, or holding off on purchases at all. Their pullback helped lead to an up to 20% drop for China's luxury market sales last year, Bain & Co estimates. That's leading brands to shift their focus back to luring wealthier Chinese who'll still be willing to splash out despite the increasingly shaky consumer sentiment. Success in China is critical for luxury brands, which are also facing challenges in their other largest market – the US, where consumer sentiment has slumped to an almost five-year low amid uncertainty from Donald Trump's tariffs. Balenciaga, Versace, Valentino and Alibaba didn't respond to requests for comment. Tmall's changing role The changing pricing strategy also reflects luxury labels' new understanding of Tmall and the crucial role it plays in shaping consumer perceptions about a brand in the mainland, said Jacques Roizen, managing director of China consulting at Digital Luxury Group. As Tmall becomes more important for sales, brands' pricing on the platform can help telegraph wider shifts in their China strategies. While ultra-premium brands including Hermes and Chanel still make most of their sales from physical stores, online channels are gaining increasing importance for lower-tier luxury labels. The ecommerce market accounted for 46% of China's total luxury sales last year and is expected to surpass offline sales in three to five years, according to consultancy Yaok Group. As products return to full price, pressure will grow for some labels over how to offload excess stock, after some of last year's deep Tmall discounts reflected panic over unsold inventory. Read more: Hermes overtakes LVMH to become the most valuable luxury fashion company And not all high-end brands are pulling back from sales – some, like Richemont's Chloe and Capri Holdings Ltd's Michael Kors, are offering markdowns on Tmall similar to those that were available in 2024. Chloe and Michael Kors didn't respond to requests for comment. Still, by curbing price cuts on the platform, a growing number of luxury brands are bringing their China pricing strategy more in line with their global approach – where they clear stock via discreet, private sales events that take place only limited times a year and there's little visible public discounting. "While smaller discounts may pressure short-term inventory clearance capabilities, the shift ensures a consistent brand message across all consumer touchpoints,' Roizen said. "Brands that adapt early to this strategy are likely to lead the market recovery.' – Bloomberg
