How Do You Feel About Chinese Manufacturing In The US?

The Chinese aren’t coming. They’re already here.

This week, it was reported that a Chinese manufacturer is opening an aluminum extrusion & fabricating shop in Indiana. There are other examples of this trend, like the Chinese energy company Suntech opening a production & manufacturing plant in Arizona.

Does this bother you?

At a time when we need all the solid, good-paying manufacturing jobs we can get, are you concerned?

While US economists and pundits argue that exporting to emerging markets like China won’t work, does anyone see this as a bad idea?

What we’re seeing today is the evolution from a continental economy to a global economy – certainly where manufacturing’s concerned, it is. And in that evolution, more and more countries are going to realize that it makes more economic sense to produce closer to consumption. That’s a notion that is as lean as it gets.

This isn’t an issue of shipping US manufacturing jobs overseas to return products back here. That’s the pursuit of short-term gain for its own sake, and isn’t sustainable. We’re seeing that play out now.

This is about how you feel about Chinese companies setting up manufacturing shops here. To make products to sell here.

If it does bother you, what’s your rationale? Does it trouble you because they’re Chinese? How is BMW or Mercedes producing cars here different?

And if it doesn’t, does that mean you support an exporting strategy overseas to sell into emerging or affluent markets?

I’d really like to hear how you feel.

AJ Sweatt
  1. Well, I like the underdog. America is now an underdog in terms of manufacturing. Slow, lazy and still calling plays from the 60’s. But we can’t give up. Did we give up when the Germans bombed Pearl Harbor ? – Time to revitalize, time to energize, regroup. We are on a mission from God

    • Well, in a way I’d hoped the first comment to this would have been more on topic. But after thinking about it, this ain’t half bad. Problem is that it ain’t all manufacturing’s fault here. The playing field shifted, and the cats that were in control (and set it up) didn’t give ’em a heads up. Just that simple.

      But these companies that are setting up shop here aren’t all bad. On the contrary, we’ll be seeing more from China, and EMEA and APAC in the coming months and years. And if we’re smart, we’ll follow the same path by pursuing production closer to the markets we’ll wanna sell to.

      Thanks for the take. The only thing missing is kamikazes, pool-side.

  2. Like we discussed in a different blog…… The money ALWAYS finds it’s way back to where it starts. The developing markets of the world need a strong U.S. no matter what they say. We are the best market ever to face the earth and the free markets can’t be stopped. The money will always make it back here one way or another.

    • Yep. But the issue here is that our reluctance to retain the jobs has eroded the buying power of that market. It ain’t dead yet, but prospects for growth are limited. Until we get more jobs, fix the housing mess and meaningfully address the debt (<- biggest problem, IMHO), I'm gonna welcome any activity like this that I see.

  3. If we look back to the 1970’s, Japan was the China of then. We were all afraid of the Japanese taking over all manufacturing. Everything you bought at the time seemed to have made in Japan stamped on it. Honda, Toyota, and Datsun (Nissan) were making their mark on American society. People were very concerned about the Made in America issue then. What happened over the next several decades was astonishing. Japanese manufactures realized they couldn’t do it without involving the American worker and technologies. We now have all of the major overseas car manufacturers producing vehicles here on our soil with our workers. The Chinese are now seeing the same answers as the Japanese did then. American workers and technologies are the best in the world. They can’t meet the quality demand of the American consumer without involving the American worker. Thanks A.J. for great thought provoking questions!

    • And they’re manufacturing closer to consumption – that’s an important distinction that I think small and medium manufacturers can capitalize on, if they pay attention. I have many friends and know many others that work for Honda, Toyota, BMW and Mercedes here in the US. It’s just the natural evolution of manufacturing. Sorta like what we did to the British over the past 200+ years.

      And thanks for your comments. Insightful and appreciated, as always.

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