I have no doubt that once the problems with shipping are over and freight rates come down again, China's manufacturing sector will boom. For a long time they have been adopting robotics at a rapid rate and that not only increases efficiency and quality due to reduction of faults due to human error, but it reduces costs.
As I said in my thread CHINA'S PLUS 1 STRATEGY, they have been moving offshore! They have been setting up manufacturing plants in various low labor cost countries. They have also begun some manufacturing some products in Japan, which is not a low labor cost country but has incredibly efficient manufacturing.
Latest reports on container shipping say that there is still a huge backlog of empty containers cluttering up some major ports as a result of Covid 19 having killed quite a few port workers.
I reported on this a few weeks ago:
"Yes the bottleneck in the Suez did have a huge impact, but C0VlD is also causing problems. Dock workers in some ports are dying in numbers that affect the port's ability to move containers.
This means many empty containers are lying idle. It also contibutes to the congestion that is plaguing many ports.
Another problem is inefficiency in a number of large shipping companies caused by the employment policy of co-determination. For those who don't know, that policy is imposed by various governments, requiring that employees be allowed to share in decision making."
Importers need to plan ahead for the time when some form of normality returns, but there will be many changes:
Chinese products made in other countries. No longer the "Made in China" labels.
Chinese companies more efficient. Their costs are falling.
Some shipments will depart from ports a long way from China.
Joint ventures, mergers and takeovers will disguise Chinese ownership.
Walter
As I said in my thread CHINA'S PLUS 1 STRATEGY, they have been moving offshore! They have been setting up manufacturing plants in various low labor cost countries. They have also begun some manufacturing some products in Japan, which is not a low labor cost country but has incredibly efficient manufacturing.
Latest reports on container shipping say that there is still a huge backlog of empty containers cluttering up some major ports as a result of Covid 19 having killed quite a few port workers.
I reported on this a few weeks ago:
"Yes the bottleneck in the Suez did have a huge impact, but C0VlD is also causing problems. Dock workers in some ports are dying in numbers that affect the port's ability to move containers.
This means many empty containers are lying idle. It also contibutes to the congestion that is plaguing many ports.
Another problem is inefficiency in a number of large shipping companies caused by the employment policy of co-determination. For those who don't know, that policy is imposed by various governments, requiring that employees be allowed to share in decision making."
Importers need to plan ahead for the time when some form of normality returns, but there will be many changes:
Chinese products made in other countries. No longer the "Made in China" labels.
Chinese companies more efficient. Their costs are falling.
Some shipments will depart from ports a long way from China.
Joint ventures, mergers and takeovers will disguise Chinese ownership.
Walter