KGW Group doubles down on US market, forms logistics integration JV with China's Mingkun
SHAH ALAM: Malaysia's largest trans-Pacific logistics provider, KGW Group Bhd, is doubling down on the US market through a joint venture with China's Mingkun International Logistics Ltd.
This move aims to capitalise on the manufacturing shift into Malaysia as US tariffs impact Chinese exports.
CEO Roger Wong said the joint venture entity is already set up, with KGW as a minority partner helping Mingkun expand its local presence as a logistics integrator.
'The Mingkun and KGW Global joint venture is a response to the ongoing trade war. We are seeing more Chinese businesses move into Malaysia to avoid high tariffs,' Wong told SunBiz in an exclusive interview recently.
'We want to help these factories set up here instead of going to Vietnam or Indonesia. Many of them need a one-stop logistics solution, and we can be that partner,' he said.
Wong said KGW Global and Mingkun aim to provide a comprehensive logistics solution as an integrator, especially for Chinese manufacturers expanding into Malaysia.
'Previously, KGW focused mostly on shipping because clients didn't need services like trucking or customs handling. But with these Chinese factories coming in, they want a one-stop solution because they are not very familiar with the local market,' he said.
At the same time, Wong said, KGW is planning to grow its presence in Thailand, Indonesia, and Vietnam to help businesses in those countries ship goods to the US.
'We are expanding there to strengthen our US-bound logistics network. Thailand, Indonesia, and Vietnam are the three key markets we're targeting next – not so much to grow locally in those markets, but to move cargo from those countries into the US. That includes both traditional B2B shipments and e-commerce B2C,' he said.
KGW is Malaysia's largest logistics provider in trans-Pacific trade, offering ocean and air freight, freight forwarding and warehousing services.
In February, US-based Accelerated Global Solutions Inc (AGS) acquired a 15% stake in KGW. Wong said the partnership is accelerating KGW's push into US e-commerce.
'AGS operates a last-mile network in the US named SpeedX, handling deliveries for Shein and TikTok. They are embedding teams in our office. We are now scaling our US e-commerce product with them,' he added.
About 60% of KGW's revenue is tied to the US. Wong said demand is surging as clients front-load shipments during the 90-day pause in the Trump tariffs, though not as high as during the pandemic.
'Container freight used to cost US$2,000. Now it can hit US$8,000 (RM34,000). Some shipments cost as much as the products inside. We have to pre-warn our clients,' he said.
Wong believes Malaysia's low tariffs and new Investment, Trade and Industry Ministry rules requiring verified certificates of origin for US-bound cargo will increase the country's appeal to China-based exporters.
'These manufacturers require a comprehensive solution. That is why we are investing in people, facilities, and integrated logistics. We want to be their partner in Malaysia,' he said.
Looking ahead, KGW plans to expand air freight services and SME-focused e-commerce fulfilment via US-based AGS.
'AGS does a bit of traditional logistics like air and ocean freight, but most of their core business has shifted to e-commerce. Their last-mile arm, SpeedX, is quite established in the US. They cover about 60–70% of the country compared to USPS or FedEx Ground, which is substantial.'
Wong said the partnership will help KGW replicate that reach for exporters across Malaysia, Vietnam, Thailand, and Indonesia.
'AGS helps the group scale its US operations faster. Before setting up KGW Global, the company was already doing more trucking, warehousing, and customs clearance in the US than in Malaysia.
'Our service isn't just about shipping – once it lands in the US, we also handle inland delivery. It's a huge country, and we manage everything from oversized and flatbed trucking to storage and clearance.
'AGS's presence strengthens us. They're now part of our group, and that makes things move more smoothly,' he said.
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