US Manufacturers Shift Sourcing From China To Malaysia Amid Tariffs -- AMCHAM

KUALA LUMPUR, Oct 2 (Bernama) -- American manufacturers operating in Malaysia are reducing their reliance on inputs from China and increasingly sourcing from Malaysia following the implementation of US tariffs, said the American Malaysian Chamber of Commerce (AMCHAM). 

AMCHAM chief executive officer Datuk Siobhan Das said 43 per cent of manufacturers sourcing inputs from China reduced their reliance on the country after tariffs took effect, while none reported increasing it.

She also said 36 per cent of respondents adjusted their sourcing or production strategies to comply with rules-of-origin requirements, while 34 per cent increased the share of inputs sourced from Malaysia. 

"Despite all that disruption, 86 per cent of manufacturers said their underlying business model did not change significantly.

"They changed sourcing, pricing and production, but they fundamentally did not change their commitment. They adapted rather than retreated, and some of that adaptation is creating opportunities here in Malaysia," she said.

She said this in presenting the findings of AMCHAM’s survey titled 'Invested in Malaysia: The Economic Impact and Outlook of American Business' here, today.

Meanwhile, Siobhan also noted that manufacturing respondents reported a total project cost of RM42.86 billion in 2024-2025, embedded in their Malaysian operations, which increased by almost 51 per cent from the previous survey.

She noted that the findings reflected how companies view Malaysia over the long term, describing them as a vote of confidence in the country and a clear sign of their long-term commitment.

"What is especially interesting is that even among manufacturers whose revenues declined during this survey period, expectations still pointed to future growth.

"Companies saw the headwinds as surmountable and not a reason to leave Malaysia, and we see the same confidence reflected in Malaysia’s broader investment performance today," she said.

Meanwhile, Malaysian Investment Development Authority chief executive officer Datuk Sikh Shamsul Ibrahim Sikh Abdul Majid said talent remained both Malaysia’s key strength and a challenge for American companies.

He said while companies valued Malaysia’s skilled workforce, they faced difficulties in finding workers with the latest skills, particularly in advanced engineering, digital, data and artificial intelligence.

The survey drew responses from 88 AMCHAM member companies, including American multinationals, comprising manufacturers, service companies, agribusiness, extraction and energy.

-- BERNAMA