Selected business news articles
on global production |
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This section provides web links to selected
business news articles, focusing on the
development, organisation and competitiveness of industrial operations in emerging economies. |
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India and Thailand jockey for spot on
Asia's chipmaking map |
The
full-fledged entry of India and Thailand into the race for
semiconductor-manufacturing investment has symbolized the flurry of
activity to redraw the industrial map in Asia. India and Thailand are
among a collection of governments that have become well attuned to the
shifting stances of the chip companies. |
Nikkei Asia | 15 August 2023 |
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iPhone maker Foxconn's cautious pivot to
India shows limits of 'China plus one' |
Multinationals’ desire for a “China plus one”
strategy, following supply chain disruptions and geopolitical tensions
between Washington and Beijing, is driving Foxconn into a renewed push
into India, where it first invested 15 years ago but where it still only
employs some 50,000 of its 1mn global workforce. |
FT.com | 14 August 2023 |
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How China cornered the market for clean
tech |
China is responsible for the production of
about 90 per cent of the world’s rare earth elements, at least 80 per cent
of all the stages of making solar panels and 60 per cent of wind turbines
and electric-car batteries. The rise and rise of China’s clean tech
companies poses a massive competitive threat to western manufacturing
industries, including legacy carmakers and energy giants. And in the
context of a worsening technological cold war with the west, those
capabilities could become a source of leverage for China. |
FT.com | 9 August 2023 |
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The factories on the front line of China's
economic slowdown |
From slowing global demand to rising
geopolitical tensions and a tentative post-Covid recovery, China’s
manufacturers are facing some of the strongest headwinds in years. The
tale of three factories — spanning footwear and electronics — illustrates
how manufacturers are experiencing a slowdown in the world’s
second-biggest economy. |
FT.com | 1 August 2023 |
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HP to move production of millions of
computers to Thailand and Mexico |
HP is working with suppliers to shift
production of millions of consumer and commercial laptops to Thailand and
Mexico this year, in the top US computer maker’s first substantial move to
diversify its personal computer supply chain beyond China. Thailand
already has a number of PC suppliers, which could facilitate HP’s shift,
while production in Mexico would help the company better serve its primary
North American market. |
FT.com | 27 July 2023 |
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DHL invests EUR 500mn in Latin America as
clients expand supply chains beyond China |
The logistics group is building new warehouses
across alternative manufacturing hubs such as Mexico, Malaysia and Vietnam
as businesses try to diversify their sourcing. According to DHL’s head of
supply chain business, storage facilities in these countries are filling
up almost as soon as they opened. Businesses are not shutting down
operations in China, but “instead of making the next investment of growth
in China, it is done in alternative markets”. |
FT.com | 12 July 2023 |
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The carmaker from Vietnam looking to take
on Tesla |
Speed is of the essence at VinFast, the upstart carmaker hoping to become
Vietnam’s answer to Tesla. The company was founded just six years ago. Now
VinFast says it is capable of producing a quarter of a million vehicles a
year, while the company is trying to break into the US market and is
heading for a New York stock market listing this month. |
FT.com | 5 July 2023 |
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Vietnam becomes vital link in supply chain
as business pivots from China |
The accelerating shift to countries such as
Vietnam is part of a growing “China plus one” strategy to redraw global
supply chains. As rivalries grow between China and the US over technology
and security, more companies fear curbs on what and where they can
manufacture. As a result, many are supplementing production in China,
still the world’s biggest manufacturing hub, with expansion to other
countries. |
FT.com | 3 July 2023 |
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China's dominance of solar poses difficult
choices for the west |
The vast majority of the solar panels on which
the world will spend more this year than on oil will come from just one
nation. China manufactures 80 per cent of all the solar panels produced
globally. And, China’s dominance is even more pronounced when one examines
the entire supply chain. It produces 85 per cent of the global supply of
solar cells, 88 per cent of solar-grade polysilicon, and 97 per cent of
the silicon ingots and wafers that form the core of solar cells. |
FT.com | 22 June 2023 |
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Why does so much of the world's
manufacturing still take place in China? |
With the current geopolitical challenges
between China and the United States, as well as the ongoing supply chain
issues affecting manufacturers and consumers, there has been much talk
about moving global manufacturing out of China. But despite the talk,
U.S.-China trade reached a record level in 2022, with no signs of any
slowing in the near future. |
The Conversation | 14 June 2023 |
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China set to account for less than half of
US's low-cost imports from Asia |
According to Kearney, the management consulting firm, US efforts to reduce
reliance on China, as well as price-sensitive American buyers, are driving
trade towards lower-cost alternatives in Asia. "By the end of 2023,
China’s portion of US imports” from low-cost Asian countries, excluding
Japan and South Korea, “will have dropped below 50 per cent", said one of
the report’s authors. |
FT.com | 4 June 2023 |
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Lego to other Vietnam producers: Stop
chasing cheapest cost |
Factories relocating to Vietnam must stop
putting profit before the environment, Danish toymaker Lego says, as the
supply-chain shift from China continues to funnel new business into the
country. At the same time, Lego’s Vice Prsident calls on Vietnam "to be
damn serious about the country’s environmental targets", adding that the
company "will be monitoring" progress on meeting them. |
Nikkei Asia | 2 June 2023 |
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Global supply chain relocation: China's
loss is India, Vietnam's gain |
According to a recent World Economic Forum (WEF)
report, the countries most likely to benefit from the global supply chain
changes are India, Vietnam, Thailand, Indonesia, Mexico, Turkey, and
Poland. This assertion is backed by the fact that many of these countries have
managed to attract substantial foreign direct investment (FDI) in the last
few years. |
The Economic Times | 30 May 2023 |
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Indonesia challenges Thailand's title as
the
"Detroit of Asia" |
Thailand is scrambling to defend its position
as the "Detroit of Asia" as Indonesia closes the gap in auto production by
leveraging its mining resources to capitalize on a global shift to EVs and
other new energy vehicles. Looking just at passenger cars, Indonesia's
production exceeded that of Thailand in 2014 and has recently doubled its
rival's output. |
Nikkei Asia | 28 May 2023 |
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China's car market has become a Darwinian
battleground |
For most foreign auto groups, the good days in
China are now over. The likes of VW, Ford and Toyota have been caught out
in China by two fundamental transitions. First, the pace at which
consumers will abandon the internal combustion engine. And second, the
rise of China’s homegrown electric vehicle groups. |
FT.com | 26 May 2023 |
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Higher Mexican wages complicate push for
non-China supply chains |
Demands by labor unions and stricter standards
for tariff relief are squeezing manufacturers from Japan and elsewhere
that have set up shop in Mexico. The trend comes as supply chain risks
caused by U.S.-China tensions accelerate a push for nearshoring, or a
moving production closer to target markets. The recent headwinds could
force companies that sought to take advantage of cheap Mexican labor to
produce goods for the neighboring U.S. market to reassess their strategy. |
Nikkei Asia | 24 May 2023 |
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Chinese tech entrepreneurs go on global
offensive |
"Chinese entrepreneurs face intense
competition at home and an uncertain business environment, so it makes
sense many are looking at opportunities abroad", according to an investor
at start-up accelerator Plug and Play. The growing success of China’s
leading tech and industrial groups in global markets is also providing
encouragement. |
FT.com | 15 May 2023 |
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Adidas goes local as it fights to overcome
crisis in China |
Adidas wants to win back “the hearts and minds”
of Chinese consumers with patriotic clothing lines to claw back share in
its once-biggest growth market. Reviving the group’s fortunes in China is
a top priority for new chief executive Björn Gulden, who joined the brand
from Puma in January to turn round Nike’s biggest rival. |
FT.com | 24 April 2023 |
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What India can learn from Vietnam's
blueprint to replace China as a manufacturing hub |
According to global consulting firm Kearney,
India has an "excellent window of opportunity" to become a global
manufacturing hub in the long run. But the country missed the benefits of
the manufacturers’ shift out of China in 2018 – 2019, while Vietnam made
most of it. The Southeast Asian country followed the template of newly
industrialised economies such as the Republic of Korea, Taiwan, Malaysia,
and Thailand. |
The Economic Times | 20 April 2023 |
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Revving up innovation and manufacturing in
India for the medtech sector |
The medical devices sector in India has the
potential to deliver tremendous growth to the country’s economy. As per
estimates by the Government of India, the sector is pegged to grow at 26%
p.a. to reach a size of USD 50 bn by 2030. These are extremely bullish
projections for an industry whose share in the global medical devices
market is currently 1.5%. |
The Economic Times (Healthworld) | 19 April
2023 |
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Thailand, Indonesia emerge as bigger links
in EV supply chain |
Thailand and Indonesia have become two of the
hottest Asian destinations for investment in parts and materials for
electric vehicles, as Japanese, Chinese and South Korean players race to
get in at the start of EV production in the region. |
Nikkei Asia | 18 April 2023 |
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China Inc. keen on setting up shop in the US
despite tensions |
Foreign companies have for years been shifting production away from China
as relations between Washington and Beijing deteriorated. But now even
Chinese players —- from major manufacturers to small businesses —- are
finding reasons to set up shop in the U.S. |
Nikkei Asia | 31 March 2023 |
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From Apple to Boeing, India is being put to
the test as China manufacturing alternative |
India’s dream of becoming the new factory of the world will have to
overcome longstanding hurdles. A formidable bureaucracy, lagging
infrastructure and labyrinthine red tape have forced many foreign
businesses to either shun India or shutter their local operations. A lack
of skilled labor and innovation, poor production quality, and a reluctance
to adopt rapidly evolving technology are also seen as hindrances. |
CNBC | 12 March 2023 |
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How viable is Vietnam as a "friend-shoring"
destination? |
Vietnam has been pursuing a two-tier foreign policy focused on the
continuation of one-party rule and strengthening of national defense.
Under the policy, the Communist Party strives to maintain friendly ties
with China while the government seeks to bolster security ties with the
U.S. to counter China's naval expansion in the South China Sea. While some
observers foresee little change in Vietnam’s foreign policy, others
maintain that it is moving in a less pro-Western direction. |
Nikkei Asia | 5 March 2023 |
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Global firms are eyeing Asian alternatives
to Chinese manufacturing |
The
deepening decoupling between Beijing and Washington is forcing
manufacturers of high-tech products to reconsider their reliance on China.
The question for Dell, Samsung, Sony and their peers is: where to make
stuff instead? No single country offers China’s vast manufacturing base.
Yet taken together, a patchwork of economies across Asia presents a
formidable alternative. |
Yahoo Finance | 20 February 2023 |
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Central America: Nearshoring textiles has
been a success |
Historic levels of private sector investment and sourcing commitments
going into Central America have accelerated the two-way textile and
apparel trade with the United States, reshaped global sourcing and
simultaneously created more jobs and bolstered the region’s economies. |
THE HILL | 18 February 2023 |
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What it would take for Apple to disentangle
itself from China |
Apple is facing political, strategic and investor pressure to dramatically
cut its manufacturing reliance on China. But if the relationship is
untenable, it is also near-unbreakable. The operations that Apple
orchestrates are so complex and massive that it is not at all clear the
world’s biggest company has any viable options to overhaul the way it
rolls out USD 316bn worth of iGadgets each year. |
FT.com | 18 January 2023 |
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China's carmakers outstrip foreign brands
in its electrical vehicle boom |
China’s booming electric vehicle industry is forecast to further cement
its global dominance this year, shrugging off US and European efforts to
catch up and posing a threat to foreign groups reliant on the world’s
biggest car market. The biggest winners are a clutch of fast-growing local
companies that are outperforming foreign carmakers. |
FT.com | 17 January 2023 |
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Dell looks to phase out "made in China"
chips by 2024 |
US
computer maker Dell aims to stop using chips made in China by 2024 and has
told suppliers to significantly reduce the amount of other “made in China”
components in its products as part of efforts to diversify its supply
chain amid concerns over Washington-Beijing tensions. |
FT.com | 12 January 2023 |
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Karnataka's Aerospace & Defence sector to
gain from indigenous push |
India is estimated to have the potential to capture 9% of the global space
industry by 2030. Karnataka, at the vanguard of the country’s Aerospace &
Defence sector, accounting for 65% of aerospace-related exports and 70% of
its supplier base, stands to gain from increased government procurement. |
The New Indian Express | 2
January 2023 |
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Carmakers quietly cut ties with China in
supply chain shake-up |
Over the past 20 years, China has risen from obscurity to become a global
leader in the car parts industry. But international groups have now
launched a quiet yet concerted effort to cut their reliance on China’s
sprawling network of components makers. A key reason is their concern
about a breakdown in China’s relations with the international community
that could threaten trade. Although most international groups are unlikely
to abandon the Chinese market because of its size, they expect the flow of
components from the country to plants across the world to fall over time. |
FT.com | 27 December 2022 |
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Samsung increases bet on Vietnam with USD
220m R&D hub |
Samsung Electronics has launched a USD 220 million research and
development center in Hanoi, planning to make Vietnam the company's key
global strategic base, as the Southeast Asian country already produces
half of the South Korean tech giant's smartphones. The facility marks the
most concrete progress yet in Vietnam's struggle to move past cheap
manufacturing and acquire tech know-how from Samsung. |
Nikkei Asia | 23 December 2022 |
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Tata to enter chipmaking in India |
India's Tata Group will begin producing semiconductors in the country
within a few years, a move that the chairman of the group's main company
said will make the South Asian country a key part of global chip supply
chains. In a recent interview with Nikkei Asia, Tata Sons Chairman N.
Chandrasekaran revealed that the conglomerate plans to launch new
businesses in emerging fields such as electric vehicles. |
Nikkei Asia | 9 December 2022 |
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The electric vehicle boom in a quiet
Hungarian town |
In
just a few years, Hungary has transformed itself into a potential electric
vehicles powerhouse, centred on Debrecen. By 2030, battery production in
this town of 200,000 people alone will rival every European country other
than Germany. The investment boom was ignited by German automaker BMW,
which is building a Euro 2bn electric vehicle factory in the town. |
FT.com | 29 November 2022 |
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H&M has big sourcing plans for Bangladesh |
H&M
has a big plan for sourcing for Bangladesh although the price will
increase by up to 12 per cent following the country's graduation from the
grouping of the least-developed countries in 2026. After becoming a
developing nation, Bangladesh will lose its preferential market access and
face 10 to 12 per cent duty on its exports. However, it will enjoy the
duty preference in the European Union up to 2029 as the trade bloc has
extended a three-year grace period. |
The Daily Star | 17 November 2022 |
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Foreign companies adopt "China for China"
strategy |
Rather than rely on Chinese factories to
produce goods that are ultimately sold elsewhere, foreign companies are
adopting a “China for China” strategy, which aims to draw on deeper
research and development facilities in the country to make products for a
vast, growing domestic market. |
FT.com | 15 November 2022 |
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How is India emerging in the global
manufacturing sector |
India is on the road to becoming a major global
manufacturing hub. Through the implementation of different programmes and
policies, the Indian government hopes to have 25% of the economy’s output
come from manufacturing by 2025. |
The Times of India | 14
November 2022 |
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Latin America: The role of nearshoring in
shoring up supply chains |
While Latin America will not replace China
anytime soon, nearshoring in the region is not only feasible but also a
concrete reality that has the potential to bring substantial supply chain
benefits to producers, to consumers, and to the nations that have
competitive assets in manufacturing and services. |
The Wilson Quarterly | Fall 2022 |
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Chinese electric carmakers take on Europe |
For years, China’s own carmakers were confined
to their home market, and even there struggled to compete with western or
Japanese brands with petrol engine models. But the advent of electric
vehicles has given the brands their first shot at dominance — not just in
their own market, but finally on the international stage. |
FT.com | 27 October 2022 |
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Vietnam wires into global electronics |
Between 2010 and 2020, exports of electronics, computers and components
from Vietnam grew at an average annual rate of 28.6 per cent. This was
mainly the result of domestic reforms in the mid-2000s, especially the
2005 Enterprises Law and the 2000 Investment Law, allowing foreign firms
to acquire majority shareholdings in domestic enterprises. |
East Asia Forum | 25 October 2022 |
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Inside Schneider Electric's "Make in India,
Make for the World" push |
Schneider Electric, a specialist in energy management and automation, has
recently laid the foundation of a new "smart factory" in Hydrabad, India.
The company is betting big on leveraging domestic capacities to produce
world-class products: 75% of whatever is produced in the new facility will
be exported, and only 25% sold locally. |
The Economic Times | 13 October 2022 |
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After decades in China's shadow, South-East
Asia has arrived |
According to a recent Asian Development Bank report, South-East Asian
nations are set to surpass China as the fastest-growing major economies in
Asia. Malaysia, Indonesia and Thailand have forged ahead
with a series of proactive trade and industrial policies, boosting
domestic manufacturing. Thanks to its youthful and skilled workforce, and
increasingly stable political environment, the region has also emerged as
a top investment destination. |
The National | 13 October 2022 |
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Apple expands iPhone production in India in
shift away from China |
Apple has begun producing its iPhone 14 model in southern India less than
a month after it was launched, as the company works to diversify its
supply chains out of China and expand production in India. The increased
production in India is a win for prime minister Narendra Modi’s government,
which has been working to boost domestic manufacturing and exports through
its “Make in India” campaign. |
FT.com | 26 September 2022 |
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Vietnam's battle to climb the global value
chain |
Vietnam's success in attracting supply chain business has created a
dilemma for policymakers. Whereas the country has recorded technology
export growth that no substantial Asian rival has matched, it added little
value of its own to these exports and has no homegrown tech champions. |
Nikkei Asia | 21 September 2022 |
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European companies forced to take a closer
look at supply chains |
Following the Covid pandemic and Russia’s invasion of Ukraine, shortfalls
in the just-in-time model, where supply chains have to be as efficient as
possible in terms of delivery times and cost, are now clear for all to see.
Yet, while more attention has to be paid to due diligence on suppliers,
the capacity to compile and analyse data is often not good enough. |
FT.com | 20 September 2022 |
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How mobile device manufacturing is boosting
growth in Egypt's electronics sector |
Egypt’s manufacturing sector is not known for a high degree of
specialization in electronics. But homegrown companies have forged a path
for the manufacturing of local electronics, boosting Egypt’s potential to
be a regional high-tech manufacturing powerhouse. |
PYMNTS.com | 16 August 2022 |
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Indian toy manufacturers bolster production
as demand rises; eye global markets |
Favourable government policies have boosted domestic manufacturing and
helped the industry to explore global markets and enhance exports.
Increasing customs duties on imported toys and mandating Bureau of Indian
Standards (BIS) certification requirements for imports have given the
necessary push to the Indian toy industry. |
Mint | 14 August 2022 |
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South-east Asian manufacturers sweat as US mulls
tougher tariff rules |
The
Generalized System of Preferences was established in the 1970s to help
developing countries by reducing tariffs on up to 5,000 products, ranging
from bags and jewellery to mattresses and car parts. It plays an important
role in regional manufacturing — its top five beneficiaries include
Thailand, Indonesia, Cambodia and the Philippines. However, the scheme,
which covered about USD16bn in imports in 2020, has been inactive since
the end of that year, when its most recent extension expired. |
FT.com | 7 July 2022 |
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Why Mexico is missing its chance to profit
from US-China decoupling |
For
American manufacturers scrambling to dodge newly imposed tariffs on
Chinese imports, the attraction of moving production to their southern
neighbour seemed clear. Mexico offered a skilled workforce, good road and
rail connections, an established export industry and privileged trade
access. However, between 2018 and 2021 the proportion of manufactured
goods imported into the US from Mexico has barely changed. |
FT.com | 3 July 2022 |
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Is time running out for Africa to
industrialize? |
Despite efforts made to industrialize,
Africa's share of global manufacturing remains negligible. The continent’s
industrialization is geographically limited with around two-thirds of
value-added manufacturing taking place in just five nations; South Africa,
Egypt, Morocco, Algeria, and Nigeria. |
Africanews | 30 June 2022 |
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How bad is China's manufacturing exodus? |
China retains tremendous advantages as a manufacturing center built up
over the past several decades, and its enormous and rapidly expanding
domestic market provides a powerful incentive for investment in capacity
of all kinds. So far, most of the manufacturing leaving China has been in
lower-end processes. Southeast Asian nations, and even India, still have
enormous hurdles to overcome in competing with China. |
Nikkei Asia | 28 June 2022 |
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Why India isn't a global manufacturing hub |
India is a country of 1.4 billion people with a rising middle class. On
the face of it, the country presents untapped growth potential. Why would
companies not want to grow their manufacturing footprint in the
fastest-growing economy? Especially when the world’s factory, China, is
struggling with serious economic challenges. The answer lies somewhere in
the complexities of an uncertain and volatile regulatory landscape. |
Forbes India | 27 June 2022 |
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Comparing Mexico and Indonesia as
manufacturing hubs for US investors |
With the trade war between the US and China showing no signs of abating,
Indonesia and Mexico are becoming increasingly important to US businesses
engaging in manufacturing operations. Both countries represent good
investment destinations for companies with a China footprint seeking to
diversify their supply chains. |
ASEAN Briefing | 1 June 2022 |
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Electric vehicles accelerate China's
looming dominance as car exporter |
The opening of Tesla’s Shanghai factory in
2019 was a breakthrough for electric vehicles and for overseas carmakers:
it was the first wholly foreign-owned plant in the world’s largest car
market. But it also marked the start of an even bigger trend, which
promises to upend the structure of global manufacturing, bring a new wave
of deindustrialisation to Europe and trigger trade tensions of an
intensity to match the 1980s. That trend is the emergence of China as a
car exporter. |
FT.com | 1 June 2022 |
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Textiles & Apparel: Is Turkey an emerging
global sourcing hub? |
COVID-19 has impacted the global supply chains and made textile and
apparel sourcing difficult. Turkey with its skilled workforce, production
flexibility, and years of experience has emerged as a viable location for
textiles and apparel sourcing. But it has its fair share of challenges. |
Fibre2Fashion | June 2022 |
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Vietnam fires digital salvo to become
manufacturing center |
There was a time when manufacturing operations
moved to new locations because setup costs and labor were cheaper. This is
what underpinned China’s significant advance earlier this century. More
recently, it has worked for Vietnam, which has also benefitted from the
US-China freeze as it ramps up its manufacturing sector. However, there
appears to be a new differentiator: the implementation of smart factory
technologies and processes. And once again, Vietnam is leading the charge. |
CDOTrends | 30 May 2022 |
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India on path to becoming global
manufacturing hub for electric vehicles |
India’s electric vehicle (EV) segment has
witnessed sales growth of 218% in 2021-2022 as compared to the previous
fiscal year with the onset of favourable government policies, incentive
schemes, and subsidies. The commitment to achieve 100% e-mobility by 2030
along with central and various state governments’ policies and schemes
have been driving the nation’s EV segment at an exponential speed. FAME,
or Faster Adoption and Manufacturing of Electric vehicles is
currently India’s flagship scheme for promoting electric mobility. |
The Times of India | 20 May 2022 |
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Indonesia's top drugmaker Kalbe Farma to
boost ASEAN expansion |
Top
Indonesian drugmaker Kalbe Farma has announced the establishment of a
joint venture in the Philippines as the company expands across Southeast
Asia. Kalbe will control 60% of Kalbe Ecossential International, while
Philippine consumer goods distributor Ecossential Foods will hold the
remaining 40%. The joint venture is expected to help increase Kalbe's
sales of its nutrition products in the Philippines before later
introducing others such as prescription and over-the-counter drugs, as
well as herbal medicines in Southeast Asia's second most populous nation
after Indonesia. |
Nikkei Asia | 19 May 2022 |
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Africa faces hard knocks as rich countries
take manufacturing back home |
The
global economic crisis, triggered by the outbreak of the COVID pandemic in
2020 and Russia’s invasion of Ukraine in February this year, has
intensified the risk of declining trade integration between countries. For
Africa, a deglobalising world poses serious risks. According to a recent
World Bank report, reversing globalisation through the reshoring of value
chains has the potential to push an additional 52 million people into
extreme poverty. |
The Conversation | 25 April 2022 |
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India: Philips starts manufacturing radio
frequency coils under PLI scheme |
Philips India has started manufacturing radio frequency (RF) coils, used
in Magnetic Resonance Imaging (MRI) systems, in the country. India has
become the hub for manufacturing these MR coils for Philips globally.
These products are also being supplied to other OEMs across the world.
Philips was among the first companies to avail of the government’s
production-linked incentive (PLI) scheme that supported local
manufacturing of the MR coil. |
Financial Express | 23
April 2022 |
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Morocco turns to hi-tech manufacturing |
Making the most of its geographical position on the edge of Europe,
Morocco’s economic success over many years had been built on low-cost
manufacturing of food, textiles and other lower cost goods that benefited
from trade deals with the European Union. Now, however, the focus has
switched to higher value, higher tech sectors, such as pharmaceuticals,
aerospace and the automotive sector, with Moroccan companies working with
international partners to build integrated supply chains. |
African Business | 19
April 2022 |
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U.S. companies face hurdles in moving
production closer to home |
Companies looking to make their supply chains more resilient with
nearshoring strategies may only be bringing production problems closer to
home, experts say. U.S. importers who are studying shifting their sourcing
from the Asia-Pacific region to Mexico and deeper into Latin America are
finding it tougher to find suppliers with the right raw materials,
production quality and networks for getting their own components that have
been established in manufacturing hubs like China and Southeast Asia.
Reproducing that capacity and re-creating clusters of suppliers under a
nearshoring strategy will take years. |
The Wall Street Journal | 18
April 2022 |
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Help wanted: tech firms in Vietnam seek
Chinese speakers |
The
rising demand for Vietnamese employees who speak Chinese is just the
latest symptom of factories shifting to the south-east Asian nation.
Higher costs and risks in China, including its trade war with the US,
motivated companies from many countries to make the shift. But among
Vietnam’s major investors, mainland China made the biggest leap — its
cumulative investment doubled in the past five years. When also factoring
in the increases from Taiwan and Hong Kong, the shortage of workers who
can translate between Chinese and Vietnamese becomes even more profound. |
FT.com | 21 March 2022 |
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China tech champions Luxshare, Goertek move
into chip assembly |
Two
of Apple's most important Chinese product assemblers are venturing into
chip packaging for the iPhone maker. For Apple, having two more chip
assemblers in its supply chain gives the California tech giant more
bargaining power. For Beijing, having domestic companies move up the value
chain and into the more technology-intensive arena of semiconductors helps
it to build a fully independent chip industry that is insulated from U.S.
crackdowns and other geopolitical pressures. |
Nikkei Asia | 16 March 2022 |
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How Southeast Asia is getting ready for the
electric vehicle revolution |
Governments in Southeast Asia are floating very ambitious plans to capture
a share of the electric vehicle market. The aim is to create various
opportunities for the regional industry, both for the export business as
well as domestically. |
The Jakarta Post | 16 March 2022 |
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India's semiconductor push is well worth it |
As
the IC (integrated circuits) business accounts for more than 80 per cent
of the total economic value of the semiconductor market, it is high time
India takes steps to create an ecosystem for attaining self-reliance. A
typical semiconductor value chain includes strong research and development
followed by design, production, assembly, testing and distribution and
logistics network. |
The Hindu Business Line | 13 March 2022 |
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Indonesia's newest province chases USD
132bn industrial dream |
Indonesia's newest province on Borneo island, North Kalimantan, holds the
key to the government's ambition to transform Indonesia into a high-tech,
low-carbon economy. The green industrial park in North Kalimantan is
expected to become a primary showcase of the country’s economic
transformation. |
Nikkei Asia | 7 March 2022 |
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Great Wall Motor ploughs USD 1.9bn into
Brazil as global expansion picks up |
The
Baoding-headquartered group will open its biggest operation outside China
at a former Mercedes-Benz factory in the interior of Săo Paulo state,
serving as an export hub in Latin America. The Brazil venture reflects the
importance of Latin America to Chinese carmakers in their efforts to
diversify markets and access resources. |
FT.com | 28 January 2022 |
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Rising exports mask skills gap in
Cambodia's garment industry |
Cambodia's garment industry already employs over 750,000 people and
generates more than a third of the country's gross domestic product. But
it also suffers from a wider problem plaguing the economy: it is built on
low-skilled, low-cost labor, a model that some say will eventually catch
up with the nation. |
Nikkei Asia | 21 January 2022 |
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A plot to challenge Beijing's growing clout
in manufacturing |
With trade wars and rising wage rates having dented the relative advantage
of Chinese manufacturing, the pandemic and the resulting quest to
diversify global supply chains has encouraged some countries to reinvent
themselves as manufacturing hubs catering to demand from the rest of the
world. |
The Economic Times | 19
January 2022 |
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Why manufacturing is driving Vietnam's
growth |
As
global businesses seek to diversify, increase resiliency and connectivity
of their supply chains and decrease reliance on a single country, Vietnam
has become a top destination for investment in manufacturing due to its
strategic location and advantages in shipping, competitive labor, and
production costs. |
Vietnam Briefing (Dezan Shira
& Associates) | 4 January 2022 |
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Hugo Boss moves production closer to home
to shorten supply chain |
German fashion house Hugo Boss is expanding production capacity closer to
its base in Europe to reduce its dependence on south-east Asia at a time
when global supply chains are under severe pressure. Facing supply chain
disruptions with supply shortages, delays and higher shipping costs, Hugo
Boss is enlarging its factory in Izmir, Turkey, where it plans to hire
almost 1,000 more workers, increase staff by a third and invest more in
machinery and tools. |
FT.com | 30 December 2021 |
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China lays out five-year plan to be global
robotics hub |
China has unveiled a five-year plan to drive its ambition of becoming a
global innovation hub for robotics by 2025. It hopes to get there by
focusing on enhancements in key components such as servomotors and control
panels. The Chinese government is expecting high-end advanced robots to be
adopted across more sectors, including automobile, aerospace, railway,
logistics, and mining. |
ZDNet | 29 December 2021 |
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Shein: the Chinese company storming the
world of fast fashion |
Shein has seized over a quarter of the US fast-fashion market and its
rapid growth threatens to disrupt established global players such as
Spain’s Inditex and Sweden’s H&M. The business is built around the
fast-fashion model pioneered by others, including Inditex’s Zara. But
through use of automation, artificial intelligence and a well-drilled
supply chain, Shein has found a way to do it both cheaper and faster. |
FT.com | 9 December 2021 |
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Lego to invest USD 1bn in new Vietnam
factory |
Danish toymaker Lego is to invest more than USD 1bn in building a factory
in Vietnam to respond to increased demand in Asia and to make its supply
chain more resilient following a series of shocks from Covid-19. It will
be the sixth factory for the world’s largest toymaker following one in
China, three in Europe and one in Mexico, and will mostly serve south-east
Asian countries as Lego looks to capitalise on the rise of the
middle-class in the region. |
FT.com | 8 December 2021 |
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Why companies are flocking to Batu Kawan
Industrial Park (in Penang, Malaysia) |
The
Batu Kawan Industrial Park — part of a comprehensive master plan to
develop 7,000 acres on Batu Kawan Island — houses about 160 companies,
comprising a mix of foreign multinational corporations and local companies.
Business leaders highlight the key factors that contributed to their
decision to invest in Batu Kawan, namely: the availability of skilled labour,
proximity to their regional customers, and ease of doing business. |
The Edge Markets | 18 November 2021 |
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The prescription for India to create USD
400 billion in annual economic impact: Double down on manufacturing |
India’s manufacturing revolution will increasingly need to be driven by
large, global-scale conglomerates. Building global scale companies is an
area where India lags significantly. |
The Economic Times | 15
November 2021 |
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Retailers lose love for Asia: Snarled
supply chains force manufacturing exodus to Balkans, LatAm |
Major clothing and shoe companies are moving production to countries
closer to their U.S. and European stores, smarting from a resurgence in
cases of the Delta variant of the coronavirus in Vietnam and China that
slowed or shut down production for several weeks earlier this year. Their
announcements come amid a massive shipping logjam that is driving up costs
and forcing companies to rethink their globe-spanning supply chains and
low-cost manufacturing hubs in Asia. |
Reuters | 14 November 2021 |
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China's Oppo joins race to develop own
smartphone chips |
China's leading smartphone maker Oppo is developing high-end mobile chips
for its premium handsets in a bid to gain control over core components and
reduce its reliance on foreign semiconductor suppliers Qualcomm and
MediaTek. It is a bet on differentiating itself from other smartphone
makers and softening the blow from the global processor shortage. |
Nikkei Asia | 20 October 2021 |
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How Morocco transformed itself into a
carmaking hub |
Despite modest local sales, Morocco has gained critical mass as an
automotive manufacturing hub. In 2018, the kingdom surpassed South Africa
as the biggest exporter of passenger cars on the continent. The Moroccan
car industry now directly employs some 220,000 people, most of whom work
for roughly 250 suppliers that have sunk roots in the country since
carmakers began to gain real traction more than a decade ago. |
FT.com | 12 October 2021 |
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China develops passenger jet, but 40% of
parts suppliers are overseas |
A
Chinese-made passenger jet set to compete with American and European
rivals counts roughly 40% of its core component suppliers as overseas
companies, exposing the risks posed by U.S. trade frictions to a plane
that has been under development for more than a decade. Chinese companies
are supplying the fuselage and the wings. But a host of Western suppliers
are providing the brains and heart of the plane -- the communication and
flight control systems, among other core components. |
Nikkei Asia | 2 October 2021 |
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Fashion industry production is shifting to
closer regions like Turkey |
Fashion brands like Benetton are increasingly turning away from
globe-spanning supply chains and low-cost manufacturing hubs in Asia, in a
shift that could prove a lasting legacy of the coronavirus pandemic.
Italy's Benetton is bringing production closer to home, boosting
manufacturing in Turkey, Serbia, Croatia, Tunisia and Egypt, with the aim
of halving production in Asia from the end of 2022. |
Daily Sabah | 30 September 2021 |
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COVID surge in Southeast Asia disrupts
global supply chains |
The
COVID-19 pandemic and the resulting massive production disruptions in
Southeast Asia will lead to greater diversification and a major reshaping
of global supply chains, according to experts. The lockdowns and other
measures have shown how stretched and fragile global supply chains are
today. Having so many key industries like electronics and textile
production concentrated in just a few places has been bad for many
businesses. |
Deutsche Welle | 5 September 2021 |
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Reshoring – not as easy as it seems |
Reshoring has shot up the trade lexicon as ties with China, the «factory
of the world», become more unsettled and the pandemic pummels global
supply chains. A growing number of executives say they want to diversify
away from the Asian giant and make supply chains more resilient. However,
many find reshoring is far from straightforward. |
Global Trade Review | 12
August 2021 |
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India's opportunity to become a global
manufacturing hub |
As
global companies adapt their manufacturing and supply chain strategies to
build resilience, India has a unique opportunity to become a global
manufacturing hub. It has three primary assets to capitalize on this
unique opportunity: the potential for significant domestic demand, the
Indian Government’s drive to encourage manufacturing, and a distinct
demographic edge, including a considerable proportion of young workforce. |
Modern Diplomacy | 3 August 2021 |
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Airbus expanding local supply chain in
China |
The
reshaping of Airbus’ global supply chain during the pandemic will shift
greater focus to China, the world’s fastest growing aviation market.
According to the company’s Head of Procurement in China and East Asia,
Airbus is building a «vertical integration supply chain» to source parts
and materials, assemble, and deliver aircraft locally. The strategy will «lower
costs of transportation and raise efficiency», adding that Airbus will
also work collaboratively with local Chinese suppliers to bring them «in
line with global Airbus standards», strengthening its ties and
capabilities across the territory. |
Supply Chain Digital | 3
August 2021 |
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China's Baowu unseats ArcelorMittal as
world's top steelmaker |
China Baowu Steel Group became the world's largest steelmaker by volume in
2020, making it the first company to overtake ArcelorMittal in 19 years
and the first Chinese player to climb to the top of the list. China's
steelmakers have undergone major streamlining drives to curb overcapacity
even as domestic demand remained strong. With seven of the world's top 10
producers now based in China, the country has emerged as a powerhouse in
steel over veteran industry leaders like Japan. |
Nikkei Asia | 9 July 2021 |
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East Asia must adapt to retain its economic
advantages |
Global value chains have long formed the backbone of economic growth and
trade, especially in East Asia. However, East Asia must not rest on its
laurels and must continue to evolve. Low labor costs will always be
attractive, but the quality of institutions, human capital and
infrastructure can outweigh cost considerations when it comes to global
value chain strategies. |
Nikkei Asia | 14 June 2021 |
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IKEA to help suppliers in India transit to
100% renewable power |
Swedish home furnishing retailing major IKEA
will launch a programme in India, Poland and China, helping suppliers
there transit to 100 per cent renewable electricity. Under this
initiative, the company would invest and support nearly 1,600 direct
suppliers. By switching to renewable electricity, these suppliers will
save 670,000 tonne of emissions per year, which is equivalent to approx 3
per cent of the total climate footprint of the IKEA value chain. |
The Economic Times | 11 June 2021 |
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The opportunity is ripe for India to
develop as a global medtech hub |
India happens to be the fourth largest-medical
devices market in Asia and also holds the promise of the highest growth
potential among all areas of the healthcare industry. Given this scenario
the Indian medical devices industry has the prospect of becoming one of
the biggest contributors to India’s health infrastructure, much the same
way that the pharma industry has done. |
The Times of India | 9 June 2021 |
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FDI supports Vietnam climb the global value
chain |
Vietnam has successfully transformed into a
manufacturing-oriented economy, supported by stronger global value chain
participation following a rise in foreign direct investment, especially in
the manufacturing industry. Over the past two decades, Vietnam's exports
have diversified and grown exponentially, reaching USD 264 billion in 2019
— a 48-times increase from USD 5.5 billion in 1995 when it joined ASEAN. |
VietnamNet.vn | 7 June 2021 |
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Chinese supply chains prove resilient to
global shocks and pressure |
The trade war between the United States and
China and the COVID-19 pandemic have highlighted the vulnerability of
complex global supply chains. These developments have prompted a
re-evaluation of existing approaches to global sourcing and manufacturing
activities to increase supply chain resilience and reduce external risks.
It is not yet clear how China-centred supply chains have been affected.
From preliminary evidence, the impact has not been uniform across
industries. Instead, strategies of firms and industries may be heavily
dependent on their relative ease of adjusting to external changes. |
East Asia Forum | 27 May 2021 |
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Foxconn the carmaker? Disruption in the era
of electric vehicles |
Foxconn is spearheading an entire class of
electronics companies vying for a role in the carmaking industry. Pegatron,
another Taiwanese company that began life making iPhones, is now
assembling parts for electric cars for Tesla. Delta Electronics, a
Taiwanese manufacturer of a wide range of power electronics components,
makes EV charging modules and powertrains — the components that convert
the engine’s power into movement. Their push into the automotive supply
chain heralds a turning point in industrial history: the integration of
two of the world’s largest industries — car manufacturing and electronics
— which will both change beyond recognition. |
FT.com | 17 May 2021 |
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Chinese carmaker GAC presses ahead with
Myanmar factory plan |
Guangzhou Automobile Group (GAC) is pressing ahead with plans to start
manufacturing vehicles in Myanmar this year as part of the Chinese
state-owned group's ambitious internationalization plan. According to
industry experts, the Chinese domestic market is increasingly mature,
forcing automakers to find new markets for their huge production capacity.
Last year, GAC opened its first offshore factories in Nigeria and Tunisia,
while signing a deal with a Malaysian assembler to explore the possibility
of building and selling its vehicles there and in Vietnam. |
Nikkei Asia | 22 April 2021 |
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Despite the "Make in India" push, the share
of manufacturing sector in the GDP has stayed stagnant |
India has attempted to give an impetus to the manufacturing sector on
multiple occasions in the last decade. In 2014 Prime Minister Narendra
Modi launched the Make in India campaign in a bid to transform India into
a global manufacturing hub. After the pandemic pushed India into its worst
economic contraction since liberalisation in 1991, Modi, yet again,
pitched India to become the world’s factory in an effort to capitalise on
the United States-China trade war. These efforts have yielded little
result with the share of manufacturing in GDP remaining stagnant at about
17%. |
Scroll.in | 13 April 2021 |
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Fashion, Xinjiang and the perils of supply
chain transparency |
Fashion has found itself caught in the political crosshairs between
western and Chinese governments, forced to choose between the demands of
human rights groups, western consumers and their own employees on the one
hand, and the impulse to please China and its consumers in the world’s
second-largest economy on the other. |
FT.com | 9 April 2021 |
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In charts: Asia's manufacturing dominance |
Decades of investment from wealthy economies into lower-cost locations
have entrenched geographical shifts in manufacturing. Production of
semiconductors — the essential components of our digital infrastructure,
vehicles and devices — has steadily declined in the west, with East Asia
emerging as the main manufacturing hub. The US’s share of global
semiconductor manufacturing capacity fell from 37 per cent in 1990 to just
12 per cent last year, while Europe saw a 35 percentage point decline in
the period, to 9 per cent. China’s mainland expanded its share from almost
nothing to 15 per cent, a figure that is expected to rise to 24 per cent
in the next decade. |
FT.com | 24 March 2021 |
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Brazil's jet maker Embraer eyes home turf
of China's COMAC |
Brazilian jet maker Embraer, the world's top manufacturer of small passenger jets
called regional jets, aims to expand its share in China.
But China has its own homegrown aircraft maker,
Commercial Aircraft Corp. of China (COMAC), and is keen to see the
country's three major state-owned airlines use COMAC jets. |
Nikkei Asia | 19 March 2021 |
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China is still a tier-3 manufacturer in global
rankings |
Although having become a large manufacturer, China lacks the control of
core technologies making up the top end of the global value chain.
According to Miao Wei, former Minister of Industry and Information
Technology, China remains heavily dependent on imports of basic components
and technologies (over 50 percent come from abroad), integrated circuits
(80 percent imported), large-scale and high-quality imports of castings
and forgings (90 percent imported), and imports of high-end hydraulic
parts and seals (100 percent dependent on imports). |
China Briefing | 19 March 2021 |
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Geely taps Foxconn's playbook to build EVs
for other carmakers |
Geely, China's largest private-sector automaker, has taken the first step
toward becoming the Foxconn of electric vehicles. Geely and Foxconn, the
Taiwanese Apple assembler, are establishing a 50-50 joint venture that
will manufacture whole electric vehicles for clients as well as parts.
Just like Foxconn did with iPhones, Geely will pursue an economy of scale
through contract manufacturing. Foxconn brings its expertise in procuring
components and ability to produce quality digital products. Geely will
provide the auto making know-how. |
Nikkei Asia | 10 March 2021 |
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SAIC's USD 4,500 electric car takes China
by storm |
Marketed as "the people's commuting tool", the Wuling Hong Guang Mini EV
has been a big hit for state-owned SAIC Motor, China's top automaker. SAIC
holds a majority stake in SAIC-GM-Wuling, the joint venture that produces
and sells the car and is known locally as Wuling, and General Motors is a
major shareholder as well. The boxy compact can travel 120 km on a full
charge and has a top speed of 100 kph. |
Nikkei Asia | 13 February 2021 |
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Indian automakers make profits surpassing
pre-COVID levels |
Indian auto companies witnessed a sharp recovery in earnings in the last
quarter of 2020, as the festival season boosted sales despite an economic
slowdown and rising cases of COVID-19. The top three auto manufacturers —
Maruti Suzuki India, Tata Motors and Mahindra & Mahindra — all posted
profits for the first time since the pandemic hit in early 2020. It was
also the best financial performance by the automakers in seven quarters in
terms of both revenue and net profit. |
Nikkei Asia | 8 February 2021 |
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China to build USD 300bn electronics part sector
in break with US |
The
Chinese government has announced plans to expand the domestic market for
electronic components to USD 327 billion by 2023, in its latest step to
bolster the nation's tech sector amid a growing rivalry with the U.S. The
announcement covers components, materials and manufacturing equipment used
in such areas as smartphones, drones, 5G wireless, connected factories,
electric vehicles, robotics, high-speed rail and aerospace. China aims to
increase the market for these components by 20% between 2019 and 2023
under an action plan that involves the development of 15 globally
competitive electronic components makers with 10 billion yuan or more in
annual sales. |
Nikkei Asia | 30 January 2021 |
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Vietnam courts chip investment to power up
digital economy |
Vietnam is moving to build a bigger digital economy, driven in part by
semiconductor manufacturing, during the next five years and beyond as the
Communist Party maps out a course that will take the country's economy to
2045. The digital economy’s contribution to gross domestic product is
targeted to about 20% by 2025 and 30% by 2030. Making a shift to
high-quality and value-added products is to play a major role in achieving
the targets. Building a cluster of domestic chip industry is a potential
move for Vietnam to climb up the value chain. |
Nikkei Asia | 29 January 2021 |
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Vietnam's Vingroup to export electric SUVs
to US and Europe from 2022 |
Vingroup has unveiled a lineup of electric vehicles to gain a foothold in
the American and European car markets. Vingroup subsidiary VinFast will
produce three sport utility vehicle models that use artificial
intelligence to run autopilot features such as steering, parking
assistance and 3D mapping. Vingroup said it will start taking orders for
the SUVs in November, with plans to deliver them to U.S., Canadian and
European drivers in June 2022. |
Nikkei Asia | 26 January 2021 |
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Asean electronics companies still lag China in
climbing global value chain |
Despite ongoing supply-chain shifts into Southeast Asia, the Asean
economies that have been key beneficiaries will still be hard-pressed to
compete with mainland China. The Asean Quad – Malaysia, the Philippines,
Thailand and Vietnam – has built a dominant presence in niche segments of
the electronics industry, such as office equipment in the Philippines,
computers and radio equipment in Thailand, and telecom equipment in
Vietnam. However, while these countries have a lot to offer, China retains
a competitive edge and has achieved economies of scale across multiple
electronics goods segments. |
The Business Times | 13
January 2021 |