Insights
Because of COVID-19, Manufacturers in China Are Now Looking at the TX-MX Border Region
Rosemary Coates, an expert on reshoring says the Texas-Mexico border region can benefit from the COVID-19 induced disruption to the supply chains used by manufacturers in China, calling it a win-win for all. Coates states “we are particularly excited about the border region because of the opportunity to manufacture in a low-cost environment in Mexico and then also the cross border (region) with the USMCA influence with cross border commerce to the customer base.”
Coates: COVID has led manufacturers in China to look at TX-MX border region
Size of U.S. Talent Pool, New Tech Job Opportunities Fueling Growing Reshoring Interest
Wharton professor Morris Cohen is a leading researcher on reshoring trends involving manufacturing. After decades of offshoring, multinational companies are starting to bring some of their manufacturing and technology operations back to North America. This trend is gaining steam and could have serious implications for global business operations, employment levels, government relations, and economic growth. During a recent panel discussion moderated by Professor Cohen, several reasons were identified for the growing trend in reshoring. These factors include: supply chain disruptions caused by the pandemic; higher costs and greater risks of doing business overseas; improvements in technology, innovation and talent pools that lower the cost of manufacturing in North America; and volatility in foreign exchange and other overseas financial risks, which can wipe out the profit of a global company overnight.
Reshoring the Pharmaceutical Industry from Asia to North America
The pharmaceutical industry has embraced a global supply chain model for decades, seeking cost advantages made available by offshore manufacturing of and access to active pharmaceutical ingredients (APIs), particularly in Asia. However, supply chain disruptions caused by the COVID-19 pandemic and other factors, are motivating companies to modify their global supply chains and shift to more domestic manufacturing, aided by new technologies and equipment that can reduce costs. Advanced manufacturing and other modern technology should allow US-based manufacturers to compete with manufacturers in lower-cost foreign countries. The primary application of advanced manufacturing technology for APIs would be the implementation of continuous manufacturing versus traditional batch manufacturing.
https://www.pharmasalmanac.com/articles/reshoring-a-nations-api-and-pharmaceutical-production
How the United States, Canada and Australia are Working Together to Support Closeshoring of Critical Minerals
The United States is heavily dependent on foreign sources for many of the critical mineral commodities necessary for America’s economy and security. The US is 100% dependant on foreign sources for 1/3 of the 35 minerals deemed critical by the Department of the Interior. To address this dependency, the Administration published A Federal Strategy to Ensure Secure and Reliable Supplies of Critical Minerals, and, as part of that strategy, the USGS has begun multiple domestic projects to increase knowledge and understanding of the country’s mineral endowment. But in addition to that work, the USGS has also reached out to international partners, particularly those in Australia and Canada.
Reshoring Accelerated by the Pandemic is the Single Biggest Opportunity US Manufacturers Have Seen in 70 Years
Tony Uphoff, President and CEO of product sourcing platform Thomasnet, indicates that pandemic-induced reshoring of US manufacturing “is the single biggest opportunity U.S. manufacturers have seen in 70 years.” According to Uphoff, “scores of companies are awakening to the fact that they underestimated the risks of manufacturing overseas.” Over the coming months and years, many companies will look to end their reliance on manufacturing in remote parts of the world, transitioning their manufacturing and supply chains to North America.
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