Onshoring

Onshoring has become the word of the moment, the expression of hope, the exposure of wishful thinking to those who try to intepret relatively small onshoring activities as major moves for job and economic recovery.

Flextronics CEO Mike McNamara pointed out in an interview with Larry Dignan of ZDNet, “As you see things that get pushed back into the US, “a la” the (recent) Apple comment it is more than just having the right cost structure. You also have to design for more automation and more different kinds of productivity. So, it is an evolution; it is not just flipping a switch. You actually have to spend a lot of work in the design, all the way through to the manufacturing process, knowing where you are going to manufacture. I think it is going to take time.”

It will not only take time, it will take incentives from the government. If Taiwan can do it, why can’t America do it? A major lure could be the lowering of one of the world’s highest corporate tax rates. Another would be to remove or simplify many of the “make-do” reporting procedures and requirements that seem to do nothing but tie a company’s hands, increase costs, and create more public sector jobs.

Taiwan’s new reinvestment incentives began last month, with an aggressive goal of more than doubling the returning investment from overseas Taiwanese businesses to $6.89 billion over the next two years. Companies need to meet certain requirements, such as producing critical components or marketing products under their own brand. Taiwan’s government announced on Dec. 6 that Catcher Technology and Largan Precision will invest in new factories in Taiwan that will create some 3,800 jobs over the next few years.

About Gene

Gene Weiner has spent his entire career -- spanning more than 50 years -- in the printed circuit industry. He spent the early part of his career in chemical engineering at MIT Lincoln Laboratories, then became employee no. 4 at Shipley, and later vice president of sales and marketing at Dynachem and president of New England Laminates. He has been a consultant to leading materials, circuit board and semiconductor companies for several years, and sits on the board of Wong’s Kong King International and the MBA advisory board of the Malcolm Baldridge School of Business at Post University. He was inducted to the IPC Hall of Fame in 2006.
This entry was posted in Weiner's World and tagged , , , , , . Bookmark the permalink.