South East Asia's metalworking industry outlook for 2025

In the December 2024 outlook report for International Metalworking News for Asia, Manny Valenza, Sales Cluster Manager for South East Asia at Sandvik Coromant, explores the factors driving this change, including foreign direct investment, technological advancements, and sustainable manufacturing practices. Valenza highlights how Sandvik Coromant is contributing to the region's growth through its Manufacturing Wellness mission, which promotes sustainability, waste reduction, and skill development to future-proof the metalworking industry.

As global companies expand their manufacturing operations in Southeast Asia and demand for metalworking capabilities grows, the region is poised to thrive. With innovations like the Sustainability Analyser, reconditioning and recycling initiatives, and extensive training programs, Sandvik Coromant is empowering manufacturers to embrace efficiency and sustainability, ensuring a bright future for the industry in 2025.

We’ve seen over the last few years how South East Asia has become a global manufacturing hub. And for good reason. Malaysia is renowned for semiconductor production, Vietnam for electronics and Thailand has become a key player in automotive manufacturing.

This has set the region up for a change I predict we’ll see in 2025 — the diversification of global supply chains. Major global companies, including Chinese firms, are expanding their manufacturing operations in South East Asian countries, like Malaysia, Vietnam and Thailand. This is driving significant foreign direct investment and growth in exports from the region.

In particular, Chinese automotive manufacturers such as Great Wall Motors and Changan Automobile have made significant investments to expand their production footprint in Thailand to serve the South East Asian market. This will inevitably increase demand for metalworking capabilities in the region to support these new manufacturing hubs.

Regarding technological advancements, Singapore has become recognised as a leader in advanced manufacturing for the region. Its robust research and development ecosystem, network of contract manufacturers and skilled workforce are likely to support the growth and technological advancement of the metalworking industry across South East Asia in 2025.

Sandvik Coromant’s contribution is our ongoing commitment to driving the industry forward through our Manufacturing Wellness mission. This encompasses habits that create an industry of resilient, thriving and sustainable manufacturers that generate positive impacts on their environments and the wider industry. We believe that by nurturing healthy production habits, which include embracing modern technology, choosing a sustainable path and taking a holistic approach, we will cultivate a future proofed manufacturing industry.

One of the habits focuses on the elimination of waste. And it’s here that Sandvik Coromant’s Sustainability Analyser equips manufacturers with the knowledge to better understand their data, and subsequently reduce emissions. The tool is designed to measure energy consumption per component in kilowatt hours (kWh), the energy consumption per year and the amount of CO2 emissions generated per year. With this information, manufacturers can become more productive while reducing their emissions output. Additionally, global programs such as our tool reconditioning and recycling intiatives mean customers can not only limit the amount of waste they produce, but see profit from it too. We buy back used cutting tools from all manufacturers, extracting their solid carbide to help form new ones. Our tool reconditioning service means more value can be extracted from Sandvik Coromant tools, which can be used multiple times before being recycled.

Besides this, knowledge is power. That’s why we offer a variety of technical training through our online Sandvik Coromant Academy platform. From enhancing process security to milling techniques, our e-learning platform tackles different challenges with the aim to close the skills gap, boost business performance and benefit the wider industry.

Moving beyond the digital space, our network of 15 global Sandvik Coromant Centres allows us to share engineering expertise with customers through practical demonstrations and tutorials. We currently have four in Asia for our customers to visit.

The future looks bright for 2025. While we can expect smart and sustainable manufacturing to continue to be a significant focus, the South East Asian metalworking industry is poised for substantial growth. This is driven by the region's attractiveness as a manufacturing hub, the ongoing shifts in global supply chain dynamics and investments from both domestic and international players.