Headine from Manufacturing Executive: Caterpillar Reshores Japanese Production Back Home: Part Of A Trend?

December 27, 2011

Caterpillar said, “It was moving the production lines from Japan to reduce logistics costs, improve delivery times, and be able to respond faster to the customers who now use most of these products in the Americas and Europe.”

Welcome news indeed. It seems that the reshoring initiatives are picking up steam. I recently heard of other manufacturers that are bringing their jobs back to the USA. Apparently they all realize that it wasn’t all that good for them. Not too long ago one manufacturer’s rep and I discussed his company’s offshoring by telling me how the labor costs here were too high and the company that he represented had to produce in Asia where the labor costs were lower. This company is a B to C company and sells retail here in the U.S. Now that they have moved back here, their retail prices have actually LOWERED!

If this is indeed a trend, being the optimist that I am, I think that we will start seeing more companies returning to the U.S. I know the logistics of a return are difficult (a building has to be set up for production, machine tools have to be considered, etc.) but they are not insurmountable.

Advertisements

%d bloggers like this: