After "lemming" exodus, manufacturers look to U.S

[n2doc]

By Scott Malone
Posted 2012/02/13 at 11:58 am EST

WASHINGTON, Feb. 13, 2012 (Reuters) — Big manufacturers moved their production out of the country too quickly over the past decades and now see a competitive advantage in building up their footprints back home, top executives said on Monday.

The chase for lower-paid workers drove the migration, which resulted in employment in the U.S. manufacturing sector falling by 40 percent from its 1980 peak. But big companies including Boeing Co and General Electric Co are now finding that the benefit of lower wages can be offset by higher logistics and materials costs.

"We, lemming-like, over the last 15 years extended our supply chains a little too far globally in the name of low cost," said Jim McNerney, chief executive of world No. 2 planemaker Boeing. "We lost control in some cases over quality and service when we did that, we underestimated in some cases the value of our workers back here."

Boeing in particular ran into extensive delays in the launch of its 787 Dreamliner aircraft, handing off much of the manufacturing responsibility to outside suppliers, leaving the launch of the fuel-efficient aircraft some three years behind schedule.

"You are going to see more (manufacturing) come back to the United States, and that's in part for business reasons and in part because we want to be good citizens," McNerney said.

more

http://www.newsdaily.com/stories/tre81c1b7-us-usa-manufacturing-onshoring/

[patrice]

1. My guess is that the next generation of talent is going to do their own thing.

They want different kinds of lives than corporations offer.

[n2doc]

3. If they have that option

Many will be just happy with a corporate job,any full time job, thank you very much!

[patrice]

5. Sorry, I didn't mean to imply that they don't.

Perhaps, you'll pardon me if I am reacting to news from some quarters that "It's over." Maybe there are some who will make deals for what is likely to be crumbs, others figure if they must settle for crumbs, they'll do that on their own terms.

[immoderate]

2. "... because we want to be good citizens."

--imm

[izquierdista]

4. Yea, then you won't mind paying taxes on repatriated capital, right?

[bbinacan]

6. Except Caterpillar n/t

[Warpy]

7. This had to happen

Shipping is expensive and with Ahmedinnerjacket threatening the Gulf, shipping routes are being seen as fragile as they really are, subject to piracy and disruption by both war and natural disaster. Manufacturing closer to the point of use makes a lot more sense and always had. They were just chasing illusory dollars.

Second, they're finding out that other countries have different problems, chief among them is conscientious quality control. The standards just aren't there for a lot of items and they're losing customers because of it. I know there are things I'll comb thrift shops and yard sales for because the new ones are shitty.

Having them move back here is inevitable. I just hope it's not too late.

[ThoughtCriminal]

8. The software company I worked for self-destructed from outsourcing

Medium size company had been profitable every quarter for over 20 years. But the CEO heard promises of "High quality" software development for less than 1/10th of what they were paying the staff programmers. So, they laid off everyone except management in the development department and outsourced all of the programming.

It was a disaster. The programmers in India were only good at finding new ways to generate "Blue Screen of Death" applications and nothing else. As I understand it, they contact in India would just claim that the software worked fine and they could not duplicate what happened on every PC it was tested on here. They could not use anything they developed and ended up limping along selling software that was produced before the outsourcing started. This happened at a critical time when desktop applications were starting lose retail space in favor on on-line. The company was dead in less than two years.