3 ms·
More likely the tariffs (and currency manipulation by the Chinese) will just result in other Asian nations ramping up their factory creation. I know my company
by moate 7y ago
More likely the tariffs (and currency manipulation by the Chinese) will just result in other Asian nations ramping up their factory creation. I know my company (we make toys and games) will be looking at Vietnam and a few other South East Asian nations before looking at home. I think you're greatly underplaying things when you say "marginal" benefit here. There's no way my company could employ as many office workers if we had to employ American factory workers instead of Chinese factory labor.
This isn't an A or B only choice. There's so many other options than US or China. And it's not just labor/safety, it's building an actual factory (which takes huge time and money commitments) which might be less viable in about 17 months if Trump and his protectionist policy aren't still in office.
- zaroth 7y agoMoving your Factory out of China to another Asian nation is a national security win, for starters. But once you’ve started considering that process, maybe you run the numbers and find the marginal cost (an economic term, not to be confused with “small”) of producing locally isn’t as high as you think. Every company importing from China is doing this analysis. For some percentage of those companies, the numbers will make sense to move into the US. Whether they are building a new local factory or contracting for space on an existing US line. And it’s not purely “is the US marginally cheaper today,” but the bigger question of; is it less risky overall to produce in the US based on what might happen in the future? China and the US are not allies, and US companies should see some degree of risk in keeping their production in China. And I even forgot to mention the rampant intellectual property theft and counterfeiting.