As a leading manufacturer of high precision wire processing machines, Schleuniger is consistently looking at the trends and direction of the manufacturing industry to better assess the needs of our customers. Looking forward to 2013, we expect to see increasing growth in manufacturing, particularly in the U.S.
Studies conducted by several organizations indicate there is a significant cost savings to producing goods in North America compared to most other countries. Boston Consulting Group states by 2015, the average manufacturing costs in China will only be 7% less than the U.S. and Chinese labor rates are expected to double in the next six years. According to Acorn Systems Inc., some manufacturers have saved an average of $23 million in annual costs by producing goods domestically and companies are starting to take note. One example is Foxconn Electronics, a Chinese-based electronics manufacturer, which just announced plans to establish manufacturing plants in the U.S.
There are several factors contributing to this trend, which is known as "reshoring."
- The low value of the U.S. Dollar has resulted in increased exports of lower priced,
American made products.
- Higher machine automation means the overall quality is less dependent on the skills of the operator and it reduces labor costs.
- Product manufacturers are following lean philosophies and want vendors located in close
proximity to their factories, which reduces lead times, transportation costs,
inventory levels, etc., resulting in lower overall manufacturing costs.
Manufacturing is becoming a bright light in the U.S. economy and given recent data, there is no reason to expect it will slow down in the years ahead.
