China Manufacturing: on Brink of Collapse?

Ah the winds of change. Seems nothing is more constant than change, right? Well they seem to be blowing in from the east these days, the Far East, as in China. On the eve of the 2008 Olympic Games, there is trouble afoot and I don’t mean the smog, I mean Chinese manufacturing.

China is experiencing a triple witching that is threatening to ruin the stronghold in the manufacturing sector that that country has enjoyed for the last twenty years. Ever increasing labor costs, outrageous energy costs, and production quality issues have sounded the early warning sirens around the globe that now maybe a good time to look for other manufacturing alternatives.

Funny how fickle large multinationals can be when it comes to cheap labor!

Companies and countries alike are taking a second look at their exposure in China. Some are opting for other lower-wage countries like Kazakhstan, Bangladesh, and India while others are choosing to return home to wave the “made in (insert country name) here” flag.

Still others have had to consider pulling out of China because of the negative impact their product liability has caused in their respective countries. Fisher-Price, a division of Mattel for example, was involved in a massive scandal in August 2007 that resulted in the recall of a million toys, including the popular Dora the Explorer and Sesame Street toy lines because the toys may have been coated in a lead-based paint. I doubt the firm has or ever will recover.

While the impact is minimal today, China will soon be forced to deal with the growing concerns of companies seeking to address the rising costs of goods back home. These firms will either continue to drive down costs in China, or relocate to other countries that promise lower operating overhead while providing higher production standards. But no matter what happens in the short term, it’s going to take a while before some country comes along and unseats China from the manufacturing throne they currently occupy.

China Manufacturing - Too Expensive?

Alright boys and girls, hold onto your knickers, this is going to be fun. I just finished an article by KEITH BRADSHER who says manufacturing in China is getting too expensive. Don’t get me wrong, it’s a great article, but WTF are we talking about here? Seems as if China is losing manufacturing jobs to other, poorer countries because of China’s rising wages.

Now, I don’t want to go off on a rant here, but how in the hell has China already gotten too expensive to manufacture goods? I mean everything from plastic cup manufacturing to building jet engines has gotten done in China, a country with an average income of $160 dollars. Forget the whole Wal-Mart bad, unions good thing, that’s old and played out. The question I want answered is this.

When do we run out of poor, uneducated people to exploit?

I mean really, there can’t be that many countries left that would be willing to subjugate their people and allow the messes that we have created in China. The pollution, the sub-standard living conditions, the total lack of respect for an entire population. I guess there are still countries in Southeast Asia to exploit, and after we rape those people we can all pile on the African continent…..as long as they haven’t all died from AIDS or genocide. Besides, India got too expensive years ago, I mean there they can actually afford cars an roads, can you believe that? Cars and roads, bastards!

But here is the difference between China and India. China allowed foreign companies to come in and have their way with their people. It was China’s way of keeping a strangle hold on their people while letting someone else do it for them. It was a masterstroke in a Fascist, Communist loving, Dr. Evil kind of way. In fact, it’s worked so well, China doesn’t know what to do with all the friggin’ cash they have, after already buying most of the United States mind you!

India, well they are a different story. Indians built up India. Companies like Tata, Wipro,  and Infosys Technologies have taken their country by the hand and helped it out of the shadow of the East India Company. I just wish they would stop thinking it’s cool to kill their daughters, but again, that’s a different blog.

They say the countries that make up BRIC (Brazil, Russia, India, & China) will be the major economies in this century, that they will be the driving force behind a new world order of redistributing the wealth, taking the poor and forgotten into the middle class by building schools, providing medical care, and creating a better way of life. Well to that I say Amen. Because contrary to what many people say, trade stops wars.