brake drum manufacturer leaving china moving to rockford il

the reason---rising cost of shipping,strengthening of the chinese currency against the dollar ,and the high price of iron ore...

http://www.businessrockford.com/archive/x1822518008/Brake-drum-maker-moving-in

40 more jobs when every job counts

One of the interesting side effects of the increased cost of transportation and metals might be that people begin sourcing and manufacturing certain items closer to the market. I hadn't thought about that.

And it's good to see even if it's a drop in the bucket.

Something else to watch for: The Chinese people have been living in abject poverty for decades. They are still not affluent on average by our standards but they have gotten a taste of the good life. Any trend that sends them back from whence they came will be met with a serious upheaval.

China "calling in their markers" and turning American dollars into toilet paper.

Sure it may be cheap in the short run, but eventually the workers demand higher wages because they want to have the goods that they're making, or go to McDonalds and eat cheeseburgers, or whatever the "good life" means to them. Eventually, the labor isn't cheap anymore. We saw this happen with Inida and technical services: it isn't cost-effective to outsource to India anymore because the workers are demanding higher wages.

When you can make a product (quality issue aside) for $5 but it costs $18 to ship it here, its cheaper to make it for $20 here. And we'll start to see more of that very soon because many businesses now employ JIT (just in time) ordering processes instead of holding large inventories of parts, supplies, etc.

"lowerst cost above all else" idiots! The fuel prices are world wide, and are affecting everybody, so they have to have had quite an effect on costs using those hugh carge vessels!

I'd bet it's the topic in every morning business meeting at all the companies who thought it was such a great idea to go after all that cheap labor! My guess is that they would have brought these jobs back to the US MONTHS ago, but were waiting to see this this price spike was going to be a long term thing or not.

And, as China builds a middle class, they can't afford to slave-laborize everything, or their own consumption would plummet and trigger MAJOR inflation.

So, as the middle class gets bigger there, wages will rise, energy costs will rise, and going 8 thousand miles to save 20 cents will become less and less a bargain.
The Professor

Firms are closing factories and offices in China coastal cities and moving them deeper into the mainland, as well as to other countries such as Vietnam. Capital combs the earth for the best repressive regime that supplies the cheapest workers, a state version of the slave labor our prison system offers here in the United States.

Wonderful system we have, the new industrial feudalism. Multinationals call the shots. They hire state apparati to do their bidding -- i.e., ensure the low cost of pacified labor by sponsoring client state repression and violence. A vulture class has emerged at the top who do well no matter if their fellow countrymen and women starve. It is the capitalist endgame, a time of transition to a new feudalism. In the US we're watching the gutting of the middle class and the emergence of the Argentina model: Unbelievable wealth at the top (we now have concentrations of wealth that exceed what preceeded the Great Depression), a thin sliver of well-paid managers and magistrates that serve the top, a shrinking borgeosie, a growing and increasingly exploited working class, and a growing underclass to keep the working class from demanding more.

(It's morning, I haven't had my coffee yet, so please excuse the ramble above!)

Most wool yarn is made out of Australian wool. So, the sheep are sheared, the wool is sent to China for scouring and any superwash treatment (I'm not buying any more of that stuff--I had no idea it was such a water-heavy process), and then the wool is shipped back to Australia for spinning in their mills or shipped to Italy or Germany or wherever to be spun. Then, it's shipped here.

I'm trying to buy more American-made yarns (Blackberry Ridge is a personal fave of mine) from American yarns. That, and spin more of my own yarn from local farmers.

At $110+, it's not such a rosy picture. I suspect we'll see more production being re-sourced back to the US because of the long-term fuel cost future.

is burning enormous amounts of fuel... fuel burned on ships registered in Liberia or Panama (to avoid taxes), staffed with foreign employees, and yet dependent on the excellent docks & waterfront infrastructures in the US..and most of that cheap shit from China heads for places like Walmart, where underpaid workers sell it to Americans ...who comp
Not a very good plan for our future..

to move one container from China to the US west coast. That's only the ocean shipping part.

(8 days on a 24knot 4500 TEU vessel burning 140 tons of fuel per day)

some of our manufacturing base back due to transportation costs, but this won't have much impact on the information jobs that have been outsourced (engineering, cust. service, architecture, medicine, etc) due to the cheap information flows over the internet.

This is what our global economy will eventually look like. Stuff will be manufactured where it is going

to be used as long as raw materials are available there. If materials are not available where stuff is

made, the costs will be prohibitive.

Unfortunately, stuff may not be made by companies that are local. As per Toyota, etc.

and diminishing union power. This, while the Chinese middle class is on the rise.

Brake drums coming from both China and India, as well as many other auto and heavy truck parts, have been showing up below accepted industry standards. The foreign firms bid on these products, then find ways to use sub-standard materials or engineering to cut the cost to make the part profitable.

The first production runs are acceptable, but after they have you as a customer, quality goes out the window.

A good case in point is heavy-duty brake drums for class 8 vehicles. China is trying to corner the world market on manufacturing these; they have flooded the market with them, undercutting competition by as much as one-quarter on price.

The only problem is that they are garbage. The metallurgy is sub-standard. The machining is sub-standard. The balancing is sub-standard. The failure rate is sub-standard.

If you use them, your higher replacement/failure rate will more than make up for the initial cheaper cost. Large trucking companies that previously used these parts based on pricing factors alone are turning to domestic production for supply.

I refused to use Chinese or Indian made parts on my tractor. My life, and the lives of those driving on the road with me, is worth far more than saving twelve or fourteen bucks on a brake drum.

After all, some Chinese manufacturer can be hard to sue when their defective brake drum fails under normal use and someone gets killed as a result. But, what do they really care? they're making money, and that's what's important

the oldest "big" valve manufacturer in illinois started buying castings from china. the machinists would be into a 4 hour machine process and the valve would have a huge pocket in the casting. 4 hours and a big piece of scrap. where my daughter works parts from india are always out of spec or can cause skin reactions from the coating..oh i won`t mention the dead bits of bugs and other trash.

That were OVAL.

You didn't need a dial indicator either, you could see it with your naked eye.

I would love to see the results of a metallurgical lab test on one.

:)

so maybe it is cheap trick bring business back to rockford...ever been there?

I wish I could say more good things about Rockford.

That said, I had some good times at the SMSW club a few times.

I've said all along, that when the companies can make things cheaper in the US, the jobs will come back. Trouble is those 40 jobs that once paid a living wage here in the US will probably pay minimum wage when the factory moves back. It's all about union busting and the CEO's wet dream of returning to the age of the robber baron having total control over wages, working conditions, environmental and safety concerns and benefits. The corporations want you to owe your soul to the company store again, like it was before FDR.

Corporate greed and GOP deregulation is what is causing about 99.9% of America's economical woes. Thank Saint Reagan for starting us down this road to ruin we find ourselves on today. Reagan was proud of his title, "Union Buster". The sellout of the American worker started in the 1980s and the democrats didn't have the guts to step in and stop the exportation of our industrial base. Obama needs to put a stop to things like NAFTA and "Unstoppable Globalization" and insist on FAIR TRADE! What's wrong with "PROTECTING" the American working class family?

to end their currency peg.