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Jobs coming back to America from China?

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  • Jobs coming back to America from China?

    http://money.cnn.com/2010/05/06/news...tune/index.htm


    Article essentially says that Chinese companies are opening up factories here as opposed to China..Reasons vary from cost of electricity, reliability of power grid, land costs and closer to American clients to meet their needs..

  • #2
    And the high cost of shipping, especially when oil breaks the $200 barrier, soon.
    1601

    Keep eye on ball.
    Hashim Khan

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    • #3
      Reshoring was the big buzz word when I was at Westec a few weeks ago

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      • #4
        A big share of it is coming to Canada. The Chinese just bought out ConocoPhillips' share of Syncrude for 4.5 billion dollars.
        Free software for calculating bolt circles and similar: Click Here

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        • #5
          Once the Chinese are forced to allow their currency to float on the world market their favorable exchange rate will disappear. Thus another reason to move Chinese production to North America.

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          • #6
            There was an article in the local Communist Journal aka Courier-Journal news paper about China buying businesses and opening businesses in the USA to overcome costs. They are also still trying to get companies to move the China. The article said they want to become a world leader in manufacturing and are trying to build businesses in many countries as well as China.

            I guess the Chinese workers are starting to want more money and the costs of manufacturing and transportation are starting to eat up their profits.

            The manufacturing may come back to the USA but it will still be owned by the Chinese. The Chinese are not going to let the companies leave their country without a fight and they will probably win because they have the MONEY and no one else does.
            It's only ink and paper

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            • #7
              Well the fat cats may be chinese, but at least us the oily rags will be able to get work.
              Build it, bodge it, but dont buy it.

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              • #8
                The chinese have been buying and building factories here for a few years now- usually either stuff that needs to be just in time, things that are unique to the US market and dont sell in China, or things that are big and heavy to ship.

                There are several chinese auto parts makers that have had US factories for up to 5 years now- the stuff needs to be made and delivered daily, and a 5 month lead time just wont do it.
                And while the Chinese have passed us in car sales, we are still one of the 2 or 3 largest manufacturing countries for automobiles.

                Wanxiang, the largest driveline company in the world, and its US subsidiary, Neapco, bought Ford's driveline division, 3 or 4 years ago, and was supposed to build a brand new factory in Michigan- dont know if they ever did, though.
                They have quite a bit of US production and employees- something like a dozen different plants- including Nebraska-
                http://journalstar.com/business/loca...cc4c002e0.html

                Haier, which is a huge chinese appliance company, has a factory here- they make things like special wine refridgerators- the Chinese arent big on wine.

                But an interesting development is the fact that this year, Wham-O moved 50% of its Frisbee manufacturing back to the USA.
                NOT a chinese company, but a US company, bringing back simple, relatively low tech injection molding and foam noodle extruding to the USA. On the Daily Show, they did a humorous bit on this, in which they interviewed Wham-O execs who said the Chinese were getting to be more expensive than US costs.
                http://plasticsnews.com/headlines2.html?id=17815

                Inflation has been pretty serious in China for some years now- decent condos in Bejing sell for a quarter million dollars, wages have been steadily creeping up, real estate prices are on the upswing, and the demands of workers is for better conditions, shorter hours, better pay- the same as everybody else.
                Now they have TV, cellphones, the internet- they know how the rest of the world lives, and they want some.
                Plus, the chinese government has been making a big push for High Tech manufacturing- there are government grants, tax breaks, and other legal and financial encouragements to move out of the plastic action figure and cigarette lighter businesses, and into things like autos, computers, wind generators, and the like.

                The chinese people want to be middle class. And all the evidence points to slow, but steady, progress in that direction.

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                • #9
                  I suppose once the guy running the electric plant, the people feeding the workers, and the railroads bringing the steel saw how fat the factory owners were getting they raised their prices to get a piece of it.

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                  • #10
                    Japan

                    I remember Japan going through the same thing I remember as a young man machinist Tools from Japan were dirt cheep compared to U.S.A products now they are priced about the same, if not more.
                    I believe we will see China's tools prices gradually creep up to U.S prices just like Japan did.
                    Visit my site for machinist videos free charts & more

                    Machinist Classifieds Free Listing

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                    • #11
                      Originally posted by J Tiers
                      And the high cost of shipping, especially when oil breaks the $200 barrier, soon.
                      $200.00?

                      Not anytime soon in my book. $75.35 today.

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                      • #12
                        Originally posted by Machinist-Guide
                        I remember Japan going through the same thing I remember as a young man machinist Tools from Japan were dirt cheep compared to U.S.A products now they are priced about the same, if not more.
                        I believe we will see China's tools prices gradually creep up to U.S prices just like Japan did.
                        I'm glad to see someone notice this as well. I remember when Mitutoyo hit the US market, and so many of us turned our noses up at their stuff. Soon we discovered that Mitutoyo was pretty decent gear, and the prices started creeping up there as demand rose. Resting on their laurels, Starrett and Brown and Sharp had to scramble to innovate and modernize just to stay competitive.

                        My prediction is this. Like Japan, China will set up shop on US soil, and for about 20 years they'll be success. Perhaps they will even gain the stigma of quality the Japanese have established (I doubt it). Then they'll become americanized, and the life will be greedily sucked out of them as well, falling to all the trappings of manufacturing in USA. Soon, Chinese products will be usurped by another emerging nation, and we'll be right here bitching about them, lol.

                        After all this happens, we'll be writing in forums about the crappy Uganda-made lathes flooding the US.
                        Sometimes the professional is hidebound by tradition while the skilled amateur, not knowing it can't be done blazes a new trail. -JCHannum

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                        • #13
                          I used to have a couple of programmers in India, 2004-2007, at that time they were running 25% of the cost of a US-based person. Come 2007 and contract renewal, wages for a well-skilled person were climbing up to 60% or more of a US salary. At that point we decided to bite the bullet and bring everything back here. The coordination expense and cultural issues are such that anything much over 40% starts sucking wind.

                          This is why every time I hear about how China and India are graduating millions of engineers a year, I laugh. The top schools like Shanghai Jiao Tong or the IITs are arguably world-class, but the quality starts to fall off a cliff pretty fast after that. Many "computer science" graduates in India don't see a computer until their last year of school or first job--they are too expensive for all but the upper crust. On the flip side, the average college student in those countries has worked almost unbelievably hard to get even to the middle rungs of the system, as the competition for limited spaces is so intense. I have no doubt the gap between us and them will continue to close.

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                          • #14
                            I have always held on to the idea that when China's standard of living rises enough ours will stop sliding.

                            Welcome to the first world China.

                            Clutch

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                            • #15
                              Originally posted by Kibby

                              My prediction is this. Like Japan, China will set up shop on US soil, and for about 20 years they'll be success. Perhaps they will even gain the stigma of quality the Japanese have established (I doubt it).
                              You are behind the times, they have already delivered excellent product. We import a digital indicator for one of our products and the low cost and extremely high quality scared me. It did take samples from several companies but the one we settled on is extremely good.

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