Can the U.S. Compete with China in Automated Manufacturing?
Proponents of tariffs against China and reshoring manufacturing to the US are expecting automation to make up for the country’s labor cost disadvantage. They believe that the US can take back a significant chunk of manufacturing from China (and other Asian manufacturing bases like Vietnam and Cambodia) with the use of large scale automation.
But therein lies a major problem in this logic. How can you dominate manufacturing through automation when your country is sorely lagging behind China in the manufacturing and use of industrial robots? If you are already at a cost disadvantage when it comes to making the very things that you hope will ramp up manufacturing to compete, how do the economics work?
Trump bringing down the cost of electricity is an important step to bringing manufacturing back to the US. But much needs to be done to even be capable of competing against China in fully automated manufacturing processes.
China is already automating faster than any other country in the world. Low cost labor intensive jobs have mostly left for Vietnam, Cambodia, India and Bangladesh. So, at best right now, the race for US factory automation is an attempt at merely catching up with China - not beat it.
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