Asia Pacific Modular Construction Market

The high rate of population growth and increased urban migration in the Asia Pacific are generating a serious demand for housing, commercial buildings, and social infrastructures. The conventional forms of construction are unable to match the rate and magnitude of development required in these booming markets. The solution to the increasing demand for livable spaces is to turn to modular construction, which is faster, more predictable, and cost-efficient. The modular solutions are increasingly being resorted to by governments to achieve affordable housing targets and urban development goals.

The modular construction requires significant upfront investments in established manufacturing plants, new and modern machinery, as well as automated production technologies. The start-up costs can be challenging for smaller developers to cover, particularly when they are uncertain about long-term project pipelines. Initial financial burdens are further increased by transportation, specialized labor, as well as quality-control systems. Although these investments are good in the long run, they tend to act as a hindrance to market entry and early adoption. Therefore, a significant number of firms are reluctant to move to modular approaches entirely, even though they are efficient in the long term.

The emerging economies in the Asia Pacific are rapidly expanding their modular production capacities to meet the increasing domestic construction demand. To minimize project delays, enhance the quality of these projects, and accommodate housing shortages, governments are promoting industrialized modes of construction. New modular factories are being established in India, Vietnam, and Indonesia, creating regional centers for prefabricated parts. These expansions cut the cost of production and enhance the efficiency of the supply chain, both in the domestic and export markets.

The logistical challenge of delivering volumetric modules over long distances is particularly significant in countries with poor road, rail, or port networks. Large-load restrictions, rough roads, and busy streets tend to slow down the movement of the modules, making the projects costly. Certain areas need dedicated transportation, convoy, and pathfinding, which makes transport operations more complicated. These problems can be compensated for by the time savings that modular construction would provide in the manufacturing process.