The American Factories Will Move From Asia

Published:2011/3/29 21:28:00 Author:Li xiao na From:SeekIC

The cost of transportation is becoming higher, so some large-scale American companies consider moving the factory from the Asian countries to the Latin American countries. It is reported by the Financial Times that the earthquake and tsunami in Japan has made the great havoc of the world’s supply chain. This incident also shows that the multinational countries will be in a passive position if some of the components are short. For example, General Motors’ factory, which is located in Louisiana State, plans to cease production, because the component supplied by Japan is short; Caterpillar declaimed that that some of its factories may be influenced by the disaster, and it has found the alternative source.

The problems in Japan will drive the large manufacturers to estimate the risk of world’s supply chain again. The report indicated that these companies had tried to find the way to simplify the supply chain before the disaster happen. Sixty-one percent of the senior administrators had considered moving the supply and manufacturing departments to their own country or near the shore. Thus the supply and demand can be connected more closely. This will cause a wave of moving in the future three years. The production department of the American manufacturers will move from Europe to America and Latin America. The corporations were enthusing about the low cost of labor power and raw material five years ago, but the benefit from the productivity is not as large as before. Therefore, the location of the factories may close to the clients in the future.

Client’s higher demand of supply time and customization also drive this transformation. Many innovations of the manufacturing sector are related with the quick response from customers. If the factories move to Thailand or Japan, the quick response is hard to be done. The other multinational companies, such as Sony Ericson, Volkswagen, Volvo and GKN, declaimed that their supply chains will be disturbed by the Japanese earthquake. The Japanese companies try their best to open the factories, but this is based on the sufficient supply of their suppliers. The related integrated circuit is MGFC40V7785.

Reprinted Url Of This Article: http://www.seekic.com/blog/IndustryNews/2011/03/29/The_American_Factories_Will_Move_From_Asia.html

Print this Page | Comments | Reading(608)