I see on the news that Japanese are relocating manufacturing out of China maybe Thailand may benefit but the baht is probably still a bit high for cheap labour who knows

If Japanese really want to move out of China (where's the link?), I think Vietnam and Taiwan would be better choices for them.

 

All of us know about the hassle of tons of paper documentation for visa, 90 day reports that we are subjected to. 

 

Not all foreigners would want to subject themselves to these requirements. It is easier to get visas in Vietnam and maybe Taiwan.

 

would that not just be exchanging one vulnerable supply chain producer with another, unless they're planning on distributing over multiple countries?

 

more likely they would move manufacturing back to japan to create jobs for their own citizens.

Vietnam will benefit.

They might get quality in their products again if made in the homeland.

Hope Australia follow suit.

1 hour ago, EricTh said:

If Japanese really want to move out of China (where's the link?), I think Vietnam and Taiwan would be better choices for them.

 

All of us know about the hassle of tons of paper documentation for visa, 90 day reports that we are subjected to. 

 

Not all foreigners would want to subject themselves to these requirements. It is easier to get visas in Vietnam and maybe Taiwan.

 

https://www.bloomberg.com/news/articles/2020-04-08/japan-to-fund-firms-to-shift-production-out-of-china

2 hours ago, Bruce Aussie Chiang Mai said:

They might get quality in their products again if made in the homeland.

Hope Australia follow suit.

maybe.  are they willing to pay the price?  china can produce quality goods, but that's not what our megacorporations want.  they look for lowest cost supplier, and don't seem to care about quality.  chinese have been producing exactly what we've requested - cheap carp at a cheap price.

 

they can move production to thailand or indonesia or vietnam, and we'll get the same garbage if the corporate buyers demand the same pricepoint.  or they can pay more for better quality - same if they keep production in china and pay more.  better quality costs more, but have to be willing to pay the price.

 

 

On 4/10/2020 at 8:44 PM, ChouDoufu said:

maybe.  are they willing to pay the price?  china can produce quality goods, but that's not what our megacorporations want.  they look for lowest cost supplier, and don't seem to care about quality.  chinese have been producing exactly what we've requested - cheap carp at a cheap price.

 

they can move production to thailand or indonesia or vietnam, and we'll get the same garbage if the corporate buyers demand the same pricepoint.  or they can pay more for better quality - same if they keep production in china and pay more.  better quality costs more, but have to be willing to pay the price.

 

 

I agree with your post, but China has been stealing intellectual property from western companies for years. 

 

Companies spend millions of dollars on R & D to develop a product, take it to China for manufacturing, and a short time later the same product is on the market for a quarter of the price.  It would be a crime anywhere else, but China. 

 

Then, there is the huge corruption in China.  Not even a western company can truly feel secure their product is built to specifications in China. 

Vietnam, not Thailand. The Japanese have long experience with the years and yen outlay required to manufacture here reliably, and that's with industrial sectors like truck/auto involving more manual labor. Manufacturing smaller scale complex goods requiring much more limited tolerance for error to tight deadlines is a different arena.

 

~o:37;

 

 

15 hours ago, Leaver said:

IThen, there is the huge corruption in China.  Not even a western company can truly feel secure their product is built to specifications in China. 

 

What is your personal experience with this ?

 

~o:37;

Many countries will be moving their manufacturing and other jobs back home from China and maybe India too. Massive changes ahead

Yes, probably the first choice will be Thailand and its EEC around Chonburi, where Japanese companies have already invested a lot. Moreover, Japan and Thailand relationship tie is very strong, and many commercial stuff is imported without duties. 

With Brexit in full swing, it's obvious..good ole UK is the only place they will be relocating to.

Get some more golf courses built.

The quality of the labour force will be less and less of an issue as robotics take over. Robots don't fall sick with a virus or wake up with a hangover.

Japan friendly infrastructure is already in place.

 

I think that Japan like the US wants to control their manufacturing and will want to take it back home

16 hours ago, Leaver said:

I agree with your post, but China has been stealing intellectual property from western companies for years. 

 

Companies spend millions of dollars on R & D to develop a product, take it to China for manufacturing, and a short time later the same product is on the market for a quarter of the price.  It would be a crime anywhere else, but China. 

 

Then, there is the huge corruption in China.  Not even a western company can truly feel secure their product is built to specifications in China. 

that is true.

 

check the filing dates for these iphone trademarks!

https://www.bbc.com/news/business-36200481

 

they also keep the machines running after the contract is completed.  say a factory is contracted to produce 1 million north face jackets.  oftentimes the factory will deliver the million, but then produce another quarter million for the domestic market.  to get around the law, they'll print new labels like "Nrth Face" or "North Eace".

 

 

 

 

 

 

Why would the Japanese government be paying japanese companies BILLIONS to move out of china to another third world country with the same problems....They will obviously be paying them to move back to japan!!

2 hours ago, champers said:

Get some more golf courses built.

The quality of the labour force will be less and less of an issue as robotics take over. Robots don't fall sick with a virus or wake up with a hangover.

Japan friendly infrastructure is already in place.

 

Robots don't buy things either

On 4/10/2020 at 2:34 PM, ChouDoufu said:

would that not just be exchanging one vulnerable supply chain producer with another, unless they're planning on distributing over multiple countries?

 

more likely they would move manufacturing back to japan to create jobs for their own citizens.

It has long been whispered that the large Japanese Manufacturers are looking at relocating their entire operations back to Japan.

By moving all their operations back to home, they have more control over the supplier chains, and do away with volatile currencies, among other things.

The one thing that is certain, is that the face of Manufacturing in SE Asia is going to change drastically in the few years post Covid19, and Thailand along with other Nations are going to be fighting over an ever decreasing pot of income from the Japanese, and all the other Foreign Investors in the Bloc.

The Japanese need to be very careful with the Thais. If the Thais try to play both sides (US and China) and allow large numbers of China firms to open in Thailand so the China companies can escape US and other Western country sanctions, the Japanese companies might get caught in the middle as Thai products are heavily penalised. 

 

The Thais already announced they would be open to such an arrangement with China. I kind of hope they are dumb enough to take the risk and have the entire economy collapse, as China's is going to. 

I  hope Not. Thai are too Chines friendly. 

Vietnam will benefit for sure, but the problem is they are far behind in terms of infrastructure and skills necessary for high value manufacturing. They are improving rapidly, much faster pace than Thailand, but at the moment space and skilled labor are at a premium. I would not be surprised to see Vietnam jump ahead of Thailand in 10 years. 

China has always been a dilemma for foreign manufacturers. They almost always require knowledge transfer (how things are made) and the quality issue is very real. But they offered a cheap and nearly endless supply of labor. That's all changing with the current Wuhan Virus crisis pushing many of the problems associated with China to the front, on top of the tariff war with America.

3 hours ago, orang37 said:

Vietnam, not Thailand. The Japanese have long experience with the years and yen outlay required to manufacture here reliably, and that's with industrial sectors like truck/auto involving more manual labor. Manufacturing smaller scale complex goods requiring much more limited tolerance for error to tight deadlines is a different arena.

 

~o:37;

 

 

https://www.cnbc.com/2020/03/05/coronavirus-apple-microsoft-google-look-to-move-production-away-from-china.html

 

Quote

Google has also asked a manufacturing partner in Thailand to prepare production lines for its so-called smart home products, such as voice assistant-enabled speakers, Nikkei said

 

Wrong, Thailand will also benefit. 

 

Thailand has been manufacturing electronics since forever, just remember how the worlds harddisk production was killed off when thailand was flooded... 

Vietnam alone can't take all of the production, it's not big enough. Everyone here will get a share of Companies bailing out of china. 

 

On 4/10/2020 at 4:17 PM, frantick said:

https://www.bloomberg.com/news/articles/2020-04-08/japan-to-fund-firms-to-shift-production-out-of-china

Bloomberg.

 

 

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My outsider bet for some of the relocation would be Myanmar. There was a large delegation business meeting last year by the Japanese. Looking to manufacturer products for export to Thailand India and China was the aim.

Made in USA used to really mean something.  Made in Japan still does.  Made in China always makes me laugh.  Oh, it's cheap.....OK, I'll buy 10 because they will break and I don't want to come back for a few days.  

 

This isn't a big part of the game, I don't think.  I'm much more curious about what Chinese companies and Chinese people in general will do.  With they sell properties around the world and go back home??  Ah, not if they're more money abroad.  So then will they be forced back?  i hope not, that's a slippery slope.

 

We need to remember all the risks;

1.  always number 1.  nuclear bombs.  always

2.  maybe that EMP thing......you know, shuts off all electricity after a bomb goes off in the sky or something.  i read a book on it.  lol.  

3.  more pandemics; we'll be more ready for the next one

4.  a water problem

5.  elections where people elect crazy people because of covid and those people start wars.  or just plain war.  

6.  banking issues....money.  

7.  other hacking things....

8.  civil unrest.  

 

what am i missing?    

Since the corona virus outbreak, there has been a lot of talk in Europe about relocating certain factories back home. I think it’s a very good idea. Many big companies are moving out of China to mostly Vietnam. Even Apple are looking in to it. 

8 hours ago, Traubert said:

Bloomberg.

 

 

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https://www.forbes.com/sites/kenrapoza/2020/04/10/kudlow-pay-the-moving-costs-of-american-companies-leaving-china/

Vietnam, Cambodia, Malaysia, Indonesia will benefit as they aggressively lobby for tech investment.  Japan has been investing for over 20-years already.

No Taiwan as it no longer is contract manufacturing haven (main export is middle management to oversee factories abroad).

 

Maybe further investments in USA and Mexico to get around tariffs and shipping expenses.

 

Doing business in China will continue to sour due to IP transfer/thefts but also increased labor costs.  It isn't cheap to manufacture there anymore but supply-chain availability forces them to continue.

Cheap Labor? Cambodia wins.

Thailand can help themselves by encouraging a lower Baht.  We can hope...