US manufacturers in Malaysia cut Chinese inputs, shift to local suppliers

October 2, 2026 at 09:17 AM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

American manufacturers in Malaysia reduced their reliance on Chinese inputs and increased local sourcing in response to US tariff pressure, according to an AMCHAM survey. Nine of 21 manufacturers that source from China cut their reliance, while 15 of 44 manufacturers increased the share of inputs sourced from Malaysia. The survey covered 84 AMCHAM member companies across 23 industries, with data for 2024 and 2025.

Key Facts

Nine of 21 manufacturers that source inputs from China reduced their reliance on Chinese suppliers after US tariffs took effect.
Fifteen of 44 manufacturers surveyed, or 34%, increased the share of inputs sourced from Malaysia in response to tariff pressure.
The survey drew responses from 84 AMCHAM member companies, including 44 manufacturers, 40 services companies, and four in agribusiness, extraction, and energy.
Manufacturers paid RM19.32 billion to 7,087 local suppliers in 2024 and 2025.
AMCHAM Malaysia CEO Datuk Siobhan Das said 86% of manufacturers reported their underlying business model did not change significantly.

Tariff Response

The American Malaysian Chamber of Commerce's latest Economic Impact Survey found that companies responded to tariff pressure by reorganising procurement, repricing products, and reshaping their workforce. Of the 21 manufacturers that source inputs from China, none increased their reliance on Chinese suppliers after the tariffs took effect. Nine companies, or 43% of the 21, reduced their reliance on China, concentrated in electronics manufacturing services and high-technology hardware. AMCHAM Malaysia CEO Datuk Siobhan Das said companies changed sourcing, pricing, and production but fundamentally did not change their commitment.

Local Supplier Payments

Across the manufacturing base, 7,087 local suppliers received RM19.32 billion in payments from manufacturers in 2024 and 2025. The 35 American manufacturing companies surveyed accounted for 91% of those suppliers and 96% of total payments. The survey data covers 2024 and 2025, with responses collected between March and May this year.