IBS appears to be more expensive compared to traditional method
"The key technology to IBS is the preparation of precast building structure off-site, which is then brought to the construction site and assembled. This allows building to be constructed with minimal effort and time at the construction site, which in turn provides tremendous cost savings to the contractors" (IBS Modular @http://ibsmodular.blogspot.com/)
IBS appears to be slightly expensive choice over the traditional method and not an appealing option to decision makers in Malaysia. IBS construction requires high initial investment capital for pre-casters to purchase new machinery, mould, importing foreign technology and wages of skilled workers for installation process (IBS Steering Committee, 2006) (Thanoon et al. 2003). IBS is also unattractive choice due to wide swing of housing demand, high interest rate and unsure economic condition (Thanoon et al. 2003).
"The potential for IBS sector in Malaysia is enormous to say the least. The conservative estimate of the industry is approximately to RM2 billion, making the future of the industry secure" (IBS Modular @ http://ibsmodular.blogspot.com/)
For contractor, using pre-fabricated components in IBS project require them to procure the components in advance with requiring of paying upfront deposit. This will give affecting the cash flow of existing payment over project progress system. As a result, small and medium class contractors viewed IBS as threats to their business and not as opportunities (IBS Roadmap Review, 2007). It appears that existing procurement and contracting system is not ‘favorable’ to both pre-caster and contractor which using IBS method.
Technical problem related to IBS
One of the biggest drawbacks for IBS adoption is the tendency to post construction failure. It is much related to improper installation by untrained constriction workforce and relatively wet climate in Malaysia. For example, Lumut Naval Base project which consists of 29 blocks of 11-storey apartments which was constructed in 1976 by Hazama Gumi and supervised by FH Kocks GmBH who is the consulting engineers at that time. The 11-storey apartments are built using pre-cast concrete walling system. The apartments are still facing problems until today with regards to defects caused by water penetrations and leakages largely due to the construction joints and panel integration between the wall system and the floor system (Anon, 2008). There's also an issue of renovation works carried out which is constraint by the pre-cast system design and also the M & E system. It will make IBS system not popular choice for developer and customer because the majority of house owner in Malaysia would like to renovate their dwelling at some point of their tenancy.