Insights into the New Manufacturing Locations

Selected business news articles on global production

This section provides web links to selected business news articles, focusing on the development and organisation of industrial operations in emerging and frontier economies.
Moving supply chains out of Cina isn't so easy

For decades, China has dominated supply chains, with most manufacturing countries following a “China Plus One” strategy for sourcing, or diversifying their operations by adding another location in Asia. But when companies add to their supplier base it introduces other variables that can offset the benefits of simply leaving China behind.

Sourcing Journal | 29 January 2019

From bikes to phones, "Made in Viernam" grows with foreign help

Vietnamese companies are branching out into new areas, in line with the government's goal of establishing the country as a manufacturing powerhouse by 2020. Real estate conglomerate Vingroup has started manufacturing electric motorbikes and smartphones and is set to enter the car industry in June. VinFast, a Vingroup unit, began selling its first electric motorbike in November. Designed in the mold of Italy's Vespa, the Klara is a stylish, well-manufactured bike that can cover up to 80 km on one charge.

Nikkei Asian Review | 13 January 2019

Trade war buoys apparel industry in Bangladesh and Vietnam

The trade spat between Washington and Beijing is providing a tailwind for garment production hubs like Bangladesh and Vietnam, as more companies move away from China to avoid U.S. tariffs and sanctions. China’s share of world exports is now down to 30% from around 40% at the beginning of the decade, with apparel companies gradually migrating to neighboring countries with cheaper labor costs. Bangladesh is the world's second-largest apparel exporter, with a 6.4% share. Vietnam comes in third at 5.8%. Wages in Vietnam are less than half that in big Chinese cities like Shanghai and Guangzhou. Labor in Bangladesh is cheaper still.

Nikkei Asian Review | 15 December 2018

BMW and Bosch support Vietnam's vision for homegrown cars

As Vingroup prepares to become the first Vietnamese automaker next year, the country's biggest private conglomerate has enlisted help from European partners like BMW and Robert Bosch to penetrate a fiercely competitive industry. VinFast, a Vingroup unit and Vietnam's first auto brand, plans to launch three models in June and an electric vehicle in September. The cars will be made at a sprawling factory in Haiphong, about two hours east of the capital city of Hanoi.

Nikkei Asian Review | 13 December 2018

For global automakers, Mexico may be better than Chattanooga

Eroding trade negotiations with Europe, coupled with steel and aluminum tariffs, have increased the cost of making cars in the United States. In mid-November, BMW announced that it planned to open another SUV production line in China. The company already had begun producing some X3 SUVs in China for sale in that country.

Forbes | 5 December 2018

Bangladesh fights for future of its garment industry

Bangladesh is battling to keep its position as the world's second-largest exporter of clothing after China, as it faces intensifying competition from Cambodia, Vietnam, Myanmar and now African countries like Ethiopia as global brands search for cheap labor. The competitive pressure has sparked consolidation of what was once a mom-and-pop industry, reducing the number of factories by 22% in the last five years. Those who have survived gain market share, expand overseas and aim to go public.

Nikkei Asian Review | 11 November 2018

Vietnam emerges as key beneficiary of trade war

Vietnamese companies are emerging as key winners of the trade war between the U.S. and China. According to a new survey, both American and Chinese companies said that as a result of the trade conflict, they have been losing market share, especially to companies from Vietnam. Chinese companies reported also losing sales equally to companies from India, the U.S. and South Korea. For American companies by contrast, Germany and Japan were the next keenest rivals.

Nikkei Asian Review | 29 October 2018

The global manufacturing industry is moving out of China

Globalization has transformed China into the “world’s factory”. Eighteen years ago, developed and newly industrialized countries moved their labor-intensive and low-tech industries into the country. However, the onset of the Sino-U.S. trade war prompted a growing number of foreign companies to leave China and move to Southeast Asia. While foreign businesses have started to leave China years ago because of soaring costs, the Sino-U.S. trade war has accelerated this process.

The Epoch Times | 19 October 2018

China set to become advanced manufacturing power

Most big manufacturers in China are expected to develop new technologies in automation and information in the next five to ten years. Large enterprises like Haier and Foxconn are leading the transformation by speeding up the development of industrial internet platforms.

Global Times | 9 October 2018

Moving up the value chain – A strategic imperative for Asian SME:s

With the changing landscape of nearshoring of Western multinational companies, SME:s in Asia can no longer rely on just being low-cost suppliers or subcontractors to multinational companies, or being intermediaries in emerging markets. Instead, they have to move up the value chain by developing new products and services, and with their own brands and market positioning.

Forbes | 1 October 2018

Want to avoid trade wars? Let firms do what comes naturally

Are tariffs the only way to stop outsourcing? According to an opinion piece by Wharton operations, information and decisions professor Morris A. Cohen, this perception ignores many of the realities of how companies actually make sourcing decisions – and the ways they naturally consider national interests when making them.

Knowledge@Wharton | 17 September 2018

Is India a future manufacturing hub for agrichemicals?

The changing scenario in global trade has made significant impact on agrichemical business in India. Although the country is still facing a lot of challenges for availability of intermediate and technical products due to high dependency on Chinese production, there has been some internal reorientation of production shifting from China to India.

AgriBusiness Global | 20 August 2018

Forecast for manufacturing overseas: China vs Vietnam

Is Vietnam the new China in the manufacturing sector? The short answer is not yet. But it does have potential to get there in the future. China’s economy is changing. While that may shuffle the cards in the country’s manufacturing sector a bit, it also opens up opportunities for countries like Vietnam to move into position of being a low-cost manufacturing hub.

Puget Sound Business Journal | 1 July 2018

There's no giant sucking sound of aerospace jobs moving to low-cost countries

Aircraft industry manufacturing competitiveness remains closely linked with high skills and high wages. Productivity is the most important metric for industry success; low costs by themselves are a much less relevant metric. In terms of US imports, lower-income countries provide less than 2%. Yet, upper-middle-income countries such as Mexico and China are a considerably larger and growing source.

Forbes | 11 June 2018

Bangladesh's textile industry holds big lessons for Nigeria

Bangladesh, once among the poorest countries in the world, is raking in $28 billion from textile export. One big reason why Bangladesh got its textile industry right was policy. Bangladesh is reputed for having more investor-friendly policies than many of its neighbours and has cheaper skilled labour. According to Reuters, the country has tax-free access to 37 countries, including the European Union, Canada and Australia. This is different from Nigeria, which serially adopts protectionist policies that make free trade hard.

Business Day | 7 May 2018

Vietnam's manufacturing miracle: Lessons for developing countries

Why is manufacturing witnessing a renaissance in Vietnam, while relapsing in many parts of the world? Given the recent clarion call by several world leaders to create manufacturing jobs in their countries, Vietnam’s experience holds lessons for developing and advanced economies alike. Some basic foundations are clearly important. Wages are still low and demographics are favorable. About half the population is below the age of 35, and Vietnam has a large and growing workforce. The country is also politically stable and close to major global supply chains. But this is not necessarily what sets Vietnam apart. Instead, we argue that Vietnam managed to capitalize on its strong foundations through good policies.

The Brookings Institution | 17 April 2018

Turkey: Not just a manufacturing hub

Over the course of multiple decades, Turkey has positioned itself as a manufacturing hub to be reckoned with. From high-end apparel entities like Balmain and Hugo Boss, to fast-fashion retailers known the world over, Western companies have been taking production eastward when looking to indulge in the best of both worlds: fair pricing and quality. Now, the nation with a population of roughly 80 million is looking to take its fashion cred from behind the scenes, to front of stage.

Forbes | 7 April 2018

What next für apparel sourcing: Outlook for 2018

How is the sourcing landscape likely to shift in 2018, and what strategies can help apparel firms and their suppliers to stay ahead? Instead of ”chasing the cheapest needle”, the focus is on how the need for speed is changing the way products are sourced and manufactured. A balanced and diversified sourcing portfolio remains key to enabling retailers to react faster to trends, commit less up-front and navigate political uncertainty. But China’s dominant role seems set to stay.

just-style.com | 5 January 2018

Why the Philippines needs a new plan to boost innovation

The share of research and development (R&D) expenditure to GDP in the Philippines is less than the 1 per cent benchmark. This is consistent with the results of the 2017 Global Innovation Index, in which the Philippines ranked fifth out of seven ASEAN member states (behind Singapore, Malaysia, Thailand and Vietnam). Other surveys suggest that only one third of firms are product innovators and only 30 to 40 per cent are engaged in process innovation. What is needed is a concrete plan of action to stir innovation.

The Diplomat | 16 December 2017

The growing giant: Managing R&D in China

Domestic Chinese firms have proven successful in narrowing the quality gap with international competitors, and are capturing the growing middle market. As a result, there is greater pressure on foreign firms to introduce new, high-quality products specifically designed for China, in order to maintain their price premium. Meeting this need requires a deep understanding of the market, country and culture that products are being designed for – demands which require R&D be carried out in-country.

Manufacturing Global | 23 November 2017

Morocco flying high as aircraft manufacturers land in the hub

Key players in the aerospace industry are shifting parts of their operations to emerging countries, such as Malaysia, the Philippines and North Africa. In less than 20 years, Morocco has become the aerospace hub in North Africa, a favourite destination for European manufacturing companies who want a head start in today’s competitive market place. Operations in these countries are considered important in order to drive down production costs and win the price competition.

Euronews | 26 October 2017

Offshoring goes full circle: Chinese firms shipping out

For decades, China was the top destination for foreign companies moving their operations abroad. But now, it is Chinese companies that are shipping out of their home market in search for new business horizons. According to analysts, ”we have seen this trend since about 2009, but there has been an uptick especially in the past two years”. And as new opportunities arise, Chinese firm’s efforts to explore production opportunities overseas may speed up.

CKGSB Knowledge | 6 September 2017

Boost to Make in India: Hyundai shifts production from Korea to India

In what could further boost the ”Make in India” initiative, Hyundai will use its manufacturing facility near Chennai to supply the Verna, a mid-size sedan, to almost all its global markets starting January 2018. The decision shows the growing confidence of the company in making bigger and more premium cars for exports in a country which has for long been known as a manufacturing base for small passenger vehicles.

The Economic Times | 1 September 2017

Manufacturing flocks to new corners of Asia

The growth of new manufacturing centres is one of the most exciting changes in the global economy. Bangladesh has achieved an economic miracle in the past 20 years and now ranks as a middle-income country. Vietnam has done the same and Cambodia is close behind. For the global economy, this offers fresh growth with less reliance on China.

FT.com | 8 August 2017

Malaysia's Industry 4.0 initiative slow on uptake

Malaysia’s embracing of Industry 4.0 ― the digital transformation of the country's manufacturing sector ― is slow on the uptake as industry players grapple with funding issues, mindset shift and low expertise. According to local experts, Malaysia is still in the infancy stage in terms of automating, remaining at the 2.0 level (mass production, assembly line).

The Edge Markets | 28 June 2017

Asean's fight to keep manufacturing edge

The challenge facing Asean is clear: Can this major manufacturing zone retain its competitive edge in the face of rapidly evolving technology? Asean accounts for about 5 per cent of global manufacturing in value-added terms. It is the seventh-largest producer globally in the auto industry, employing about 800 000 workers. Yet the region is not immune to the effects of 3D printing, robotics and automation.

The Straits Times | 7 June 2017

India to provide China competition in low-cost manufacturing

While China loses its edge in low cost manufacturing competitiveness to the Mighty Five Malaysia, India, Thailand, Indonesia and Vietnam India is likely to emerge as the frontrunner on the way to become the world’s new hub for manufacturing.

Eurasia Review | 29 March 2017

Global manufacturing giants back China's industrial evolution

The world’s second largest economy is transforming from ”Made in China” to ”Made by China”. While China’s manufacturing sector is still in the medium stage of industrial modernization, numerous measures have been rolled out to digitize and modernize, involving many opportunities for foreign firms.

CHINADAILY | 20 March 2017

India needs more leaders to put auto parts Inc on global map

Over the last 6 years, Indian auto parts exports have grown at an annual rate of 18 percent. Now, parts makers need to move from products to solutions, focusing on innovation and synergies with the global supply chain.

The Economic Times | 6 February 2017

Transforming India into a global IT hub

The IT Industry has played a key role in putting India on the global map and has emerged as a significant source of economic growth. However, India lags behind in electronics hardware manufacturing capabilities. This is due to a myriad of challenges, including the lack of a robust infrastructure and a local component ecosystem.

Business Standard | 17 January 2017

Myanmar manufacturing set for takeoff

With the end to economic sanctions triggering an investment boom and an abundance of low-cost labour, Myanmar's nascent manufacturing industries look set for major growth. The textile industry is the first to take off, as cost advantages translate into international competitiveness. But the country needs to widen the scope of industries that both import technology and also create jobs.

Nikkei Asian Review | 14 January 2017

 

Copyright © 2003 - 2019 Global Production Research Inc.

Legal Notices