anyone else buying up parts before tariffs hit?

[69hurstolds]

The American customer noticed this and also the big three noticed this. They realized if they didn't start focusing on producing a quality product nobody was going to buy the cars anymore. So from there you end up with QS9000, ISO 9000 and now I think we're at ISO 14,000 or something like that. They finally realized they had to make an affordable quality product.

Exactly. And with the advent of CNC and other computer designed stuff, there should be no way that you can't get affordable, quality parts today.

And China is very capable of making quality goods. For example, I know for a fact they made the 2010-2015 aluminum wheels for the Camaro and Camaro SS. And they are pretty nice. The main issue with China is their currency manipulation and comparatively super-cheap labor pay rates, and import/export trade control, which makes it almost impossible to compete. Many foreign countries that wants to manufacture their stuff in China must basically partner with a Chinese company in order to operate there, as well, if they deem it necessary. So you may have to let them get their fingers in your pie. So then they can copy your stuff to a tee, build it themselves to compete with your product, outprice your stuff, and leave you on the side of the road, should they choose. You go out of buisness, leave China, and they have a nice facility you helped build for them to produce someone else's designs. They make it tough to succeed by also manipulating where and when you can do business by manipulating the restictions as well. Pretty nifty, no? I know my old work company was thinking on opening a facility in China, but the deal was going to be very much one sided in China's favor from the jump. They ended up saying nope, changed our minds. Thank goodness.

 

[Hurricane77]

Exactly. And with the advent of CNC and other computer designed stuff, there should be no way that you can't get affordable, quality parts today.

And China is very capable of making quality goods. For example, I know for a fact they made the 2010-2015 aluminum wheels for the Camaro and Camaro SS. And they are pretty nice. The main issue with China is their currency manipulation and comparatively super-cheap labor pay rates, and import/export trade control, which makes it almost impossible to compete. Many foreign countries that wants to manufacture their stuff in China must basically partner with a Chinese company in order to operate there, as well, if they deem it necessary. So you may have to let them get their fingers in your pie. So then they can copy your stuff to a tee, build it themselves to compete with your product, outprice your stuff, and leave you on the side of the road, should they choose. You go out of buisness, leave China, and they have a nice facility you helped build for them to produce someone else's designs. They make it tough to succeed by also manipulating where and when you can do business by manipulating the restictions as well. Pretty nifty, no? I know my old work company was thinking on opening a facility in China, but the deal was going to be very much one sided in China's favor from the jump. They ended up saying nope, changed our minds. Thank goodness.

The bolded is certainly not exclusive to China. There are plenty of places where low wages, and low cost of living certainly make for a manufacturing advantage. When you can pay someone pennies on the dollar to run a manual machine, vs spending 6 or 7 figures on an automated CNC, makes it hard to justify that capital outlay.

Don't disagree with anything else either, just wanted to point out that the cheap labour isn't exclusive to China. You absolutely correct, China can make quality stuff. The reputation of cheap chinese products mostly comes from companies going there and having the rough equivalent of the following conversation:
Company X: Make me widget X for as cheap as possible
China: Ok, $1
Company X: What about quality/warranty?
China: We'll give you 5% extra for free to cover warranty claims
Company: Done

I've literally been on a call with a supplier where this was basically the outcome.

But, if you insist on quality standards and supervise, then you'll get a decent product.

 

[69hurstolds]

The bolded is certainly not exclusive to China. There are plenty of places where low wages, and low cost of living certainly make for a manufacturing advantage.

Totally agree. There's tons of places labor rates are cheaper than here, but with China, it's not JUST labor rates. It's a myriad of things and their economy can absorb it. Many other countries may have a handful of China's tactics. However, from what I've been hearing, China's people are starting to wake up to the fact they're getting jack squat for pay and demanding more (within reason of not going to prison or coming up "missing"), so there are strange things afoot at the Circle K for China going forward.

 

[Supercharged111]

Totally agree. There's tons of places labor rates are cheaper than here, but with China, it's not JUST labor rates. It's a myriad of things and their economy can absorb it. Many other countries may have a handful of China's tactics. However, from what I've been hearing, China's people are starting to wake up to the fact they're getting jack squat for pay and demanding more (within reason of not going to prison or coming up "missing"), so there are strange things afoot at the Circle K for China going forward.

Let's not forget that their economy faces inflation as well and the fact that their meager wages have also not likely been keeping pace. Time to shift to another emerging economy and kick that can down a road a few more decades.

 

[Bonnewagon]

Time to shift to another emerging economy

I saw a show on TV that had African companies making stuff that clearly said 'Made in Japan' on the boxes. I think they were Panasonic items. So, were they knockoffs, or was Panasonic sub-contracting to an African low wage supplier? Either way, it was definitely NOT 'Made in Japan'.

I always look to see where stuff is made. Harbor Break made it's name with Chinese tools and hardware long before anyone cared. But I have seen their stuff come from all over the world. Russia, Poland, India, Pakistan, Mexico, Indonesia, Italy, the list is extensive. It just shows that they are taking their stuff from wherever it is cheapest to produce, yet have decent enough quality for repeat customers.

Sears did the same thing for many years. The first three digits of a Sears part number are the code for the actual manufacturer. Sears did not make anything. They found the lowest cost, yet decent quality items, and put their name on it. It was always an American company that made it, usually from a small town or city, that employed local people. When I was younger, and needed extra money, you could always find a factory that was glad to hire you for part time work. When your financial situation improved, and you quit, someone else took the job. In those days, cheap labor was found in small towns across America. The higher cost of living in large cities demanded higher wages, so small towns and cities were the 'offshore' work force of those times. I am sure everyone here knows of a local industry or company that employed lots of local folks who thrived and became part of the middle class. I still blame shameless American businessmen for packing up and leaving towns destitute just to make a shitload of money overseas.

 

[WanaBa442]

I saw a show on TV that had African companies making stuff that clearly said 'Made in Japan' on the boxes. I think they were Panasonic items. So, were they knockoffs, or was Panasonic sub-contracting to an African low wage supplier? Either way, it was definitely NOT 'Made in Japan'.

I always look to see where stuff is made. Harbor Break made it's name with Chinese tools and hardware long before anyone cared. But I have seen their stuff come from all over the world. Russia, Poland, India, Pakistan, Mexico, Indonesia, Italy, the list is extensive. It just shows that they are taking their stuff from wherever it is cheapest to produce, yet have decent enough quality for repeat customers.

Sears did the same thing for many years. The first three digits of a Sears part number are the code for the actual manufacturer. Sears did not make anything. They found the lowest cost, yet decent quality items, and put their name on it. It was always an American company that made it, usually from a small town or city, that employed local people. When I was younger, and needed extra money, you could always find a factory that was glad to hire you for part time work. When your financial situation improved, and you quit, someone else took the job. In those days, cheap labor was found in small towns across America. The higher cost of living in large cities demanded higher wages, so small towns and cities were the 'offshore' work force of those times. I am sure everyone here knows of a local industry or company that employed lots of local folks who thrived and became part of the middle class. I still blame shameless American businessmen for packing up and leaving towns destitute just to make a shitload of money overseas.

Second job out of high school was in a synthetic bristle mfg. Made broom bristles, brushes etc etc, even artificial Christmas tree needles.
Hotter than Hades but the pay was good. Within 10 yrs after I left the place closed due to all the mfg moving overseas. manufacturing still hasn't returned to the bldg, used for storage now.
Was checking out the IR compressors at Tractor Supply, made in India on the pump assy.....

 

[GP403]

I saw a show on TV that had African companies making stuff that clearly said 'Made in Japan' on the boxes. I think they were Panasonic items. So, were they knockoffs, or was Panasonic sub-contracting to an African low wage supplier? Either way, it was definitely NOT 'Made in Japan'.

I watch Japanese TV when I can (cripes most of it is awful) just to try(lolol) and keep my pathetic language skills up, and they along with a lot of Asia (incl. China) have been investing in Africa like this for a while now. Govt partnerships with business to build factories and such. I'm surprised (or they're just hiding it really well) that more isn't like that, or that we haven't headed down that road. (And I'm also not surprised.)

Japan and China in Africa: from competition to collaboration | NHK WORLD-JAPAN News

The African continent is often called the "last frontier" -- the last big, untapped market. Among the countries making inroads there, China has a huge presence. Our correspondent Natsuki Shinozaki sees a future in collaboration among rivals.

www3.nhk.or.jp

Hong Kong going back to China in '98(?) and then Bush granting PNTR to China was probably the biggest factor. Before 2002 China was simply not a player. Pandora's Box if you will.

Too bad there's really no good way to adopt the JP system they used to (maybe they still do) farm out manufacturing of more niche items to small shops. I remember seeing a segment not all that long ago (a few years) where there were still small operators building really specific parts for the Shinkansen trains for JR. They had to meet really strict quality/spec requirements, but it was literally a single guy running some machining equipment in a tiny building somewhere. Our supply chain used to (sort of) be like that, smaller companies feeding up the chain... but yeah. Why bother with all of that when you can just put money and specs into the black box (shake vigorously) and get some containers of completed assemblies/product back in a few months.

the former big electronics big dogs in JP are suffering. Companies like Sharp and Toshiba i.e. quit making their own display panels not that long ago, farming it out to China and Korea (Samsung and LG) among many other things bc they couldn't keep up, both with the tech and mfg volume. They're husks of their former glory. The Keiretsu like Mitsubishi, Toyota, Sony, Panasonic** I think still do a lot natively, just bc they're the hugest, and the govt. there is involved in making sure they stay there...

** Panasonic still makes/sells so many different things there, from hair dryers, microwaves, etc to industrial stuff. They even still run tiny retail shops out in the 'burbs of Tokyo. Not sure how much is *actually* still made there though, like you say.

(my .02 on that, probably a lot wrong with everything I just said, but there it is) -and- I'm pretty sure China is about as far removed from old school Soviet/DPRK-style (omg) "Communism" at this point as it can get. That little myth needs to stop.