SINGAPORE (Oct 21): Lines formed as early as 4am on Oct 16 at some Sainsbury supermarkets in the UK. Shoppers were there to grab hold of heavily discounted Dyson products, which typically sell at premium prices. The Dyson V6 Trigger, for example, was priced at just a third of the usual selling price of £149.99 ($263.20).
Unfortunately, most of them found empty shelves. Some took to social media to express their displeasure. “I don’t know whether I am more disappointed about not getting the hoover or the fact I was excited about getting a hoover,” wrote one on Twitter.
They were not the only people disappointed by Dyson recently. Singapore’s economic officials were let down too. On Oct 10, the UK company, which gained popularity for its bagless vacuum cleaners invented by namesake James Dyson, cancelled its much-touted electric vehicle project.
Dyson’s EV assembly plant was to have been set up in Singapore. The move, when announced last year, was hailed by government officials, who said Singapore had a key role to play in growing the global EV industry. The plant would also be a high-profile project to showcase the city state as a location for advanced manufacturing activities.
In Singapore, Dyson, the man, has made his mark. Despite the hefty price tags, his uniquely designed fans, hairdryers and vacuum cleaners have won over many fans in the city state. In early July, news broke that he spent $73.8 million to buy the most expensive penthouse in Singapore; he then spent another $45 million to buy a bungalow on Cluny Road, an exclusive area for such houses. His family office, according to openings indicated on its website, was apparently on a hiring spree to fill positions here. All these moves followed Dyson’s relocation of its company headquarters to Singapore in January this year.
The decision to pull the plug on the EV is atypical of Dyson, who spent five years creating more than 5,000 vacuum cleaner prototypes before hitting commercial success to become one of the UK’s richest men.
But, the EV market is a new and tough terrain. Dyson has admitted that he cannot make this venture commercially viable for the company he fully owns. He tried to sell the designs of his car, but could not find buyers.
Recent developments in the EV market probably figured in Dyson’s decision to scrap the EV project. In the past, the Chinese government subsidised the purchase of EVs to kick-start their adoption. Inspired by homegrown EV heroes such as Wang Chuanfu of BYD Co, nearly 500 Chinese companies have entered the business of making EVs. Entire towns are geared towards the production of EVs or parts for EVs.
Public subsidy has distorted the market. In June, the subsidies were cut, leading to a drop in sales of EVs in the following three months. The cuts were intended to goad carmakers into improving the quality of their products so that consumers would be willing to pay more for better cars and not buy them because of subsidies.
Dyson did not say it was targeting China as an EV market. But, as the world’s largest EV market by unit sales, China could not have been out of the picture. And, the picture, certainly in the near to medium term, is that of consolidation, which meant that it was not the right time to move into that market.
Yet, there is no need to sigh at the stillborn Dyson EV. Just like Tesla in the EV space, Dyson is high-profile, but certainly not the only player in town. In fact, the only things Dyson had to show for its efforts were patent filings. Tesla, by contrast, is already producing the vehicles at full swing.
More importantly, the global automobile manufacturing industry is flexing its collective muscles in the EV segment. Urged on by environmentalists and backed by shareholders, traditional carmakers from BMW to Mercedes-Benz (owned by Daimler) and Toyota Motor Corp already have a list of EV models on the drawing board. They are making improvements in the technologies, dazzling consumers with cutting-edge designs and bringing forward launch schedules.
Sales of EVs now form a single-digit percentage of total vehicle sales, but the wider adoption of EVs is picking up momentum and the proportion can only grow — even though total car sales may stay stagnant or even drop.
Dyson, a firm Brexit supporter, was roundly criticised for relocating his company headquarters to Singapore. He explained that it was to “future-proof” his company.
In a way, the Dyson episode should be a sobering reminder for Singapore. For decades, wooing big-name MNCs with perks and grants to set up shop in the city state — so that they could create jobs and buy from local small and medium-sized enterprises — was a tried-and-tested formula.
It is nice to attract big names such as Dyson, but they can decamp just as easily as they put down roots here. It is more critical to inspire Singapore’s own Dysons and build our own Dysons.
