LONDON (Jan 23): The billionaire inventor James Dyson, an ardent backer of Brexit, has decided to relocate his company’s head office to Singapore in a blow to the UK government.
Dyson Ltd has mushroomed in recent years, driven by a growing customer base in Asia. Known for vacuum cleaners and hand dryers, the firm has expanded into air purifiers and hair-care products, and embarked on a costly project to build an electric car by 2021.
Jim Rowan, Dyson’s chief executive officer, said in a call with reporters that the move to Singapore was not due to tax or fears of Brexit, but to the shift in the importance of the region to the company.
The announcement comes as the UK government scrambles to reassure businesses as uncertainty over Brexit continues. Singapore doesn’t have a single car-manufacturing plant and is one of the costliest places in the world to buy an automobile, but is 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 the latest company to move its headquarters to the city state, which has free trade agreements with key trading partners such as the US and the European Union. Singapore continues to attract businesses despite high costs partly because of increasing political uncertainty globally, says Song Seng Wun, an economist at CIMB Private Banking in Singapore.
“Singapore is a sea of tranquility where policies are discussed with business leaders so you have consistency and clarity,” he said. “If you’re going to sink in a lot of investment, you’d better make sure there is visibility in your planning. Singapore’s hard and soft infrastructure also offsets the cost side, and makes it a value-added proposition for Dyson and others.”
Roland Krueger, president of Infiniti Motor Company Ltd and a former Nissan Motor Co executive, is set to join Dyson in April to oversee the business.
Revenue at Dyson reached 4.4 billion pounds (US$5.7 billion) for the year ended Dec 31, up 28%, boosted by demand for new hair products. Revenue has increased 68% over the past two years, with over 50% of the company’s profits stemming from Asia. Alibaba Group Holding Ltd said in November that some of its top-selling products during its annual Singles’ Day event came from Dyson.
The move to Singapore won’t involve big personnel changes. Rowan is already based in the city, while the chief financial officer and chief legal officer are set to move soon. The company employs close to 6,000 engineers and scientists, spread across Asia and its UK campus.
The UK cut its corporation tax rate to 19% in April 2017, and is set to reduce it to 17% in 2020. The current rate of corporate tax in Singapore is 17%, but there are numerous tax benefits, including plans to increase tax deductions for companies investing in research and development.
Dyson said Tuesday it will continue increasing R&D, with plans to double the size of its Singapore Technology Center, and to invest "hundreds of millions of pounds" in robotics. Dyson has also approached the UK government about a 350 million-pound expansion to its UK testing site.
Dyson is also continuing to roll out new products. The company is considering developing a wearable air purifier that could double as a pair of headphones, hoping to tap demand from pollution-choked cities in Asia, people with knowledge of the project said.