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Old 02-08-2012, 06:28 PM
 
Location: NJ
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http://www.tirereview.com/Article/96..._in_china.aspx

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Old 02-08-2012, 06:35 PM
 
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What will the wages look like?
"Wages" that force state and federal government to subsidize them?
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Old 02-08-2012, 06:40 PM
 
Location: NJ
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I doubt it. Other tire manufacturers pay decent wages around the same vicinity. Great to get jobs BACK from China.
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Old 02-08-2012, 08:20 PM
 
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Good deal. There have been lots of similar stories lately about other companies doing same.

Rapidly rising wages in China + relatively stable wages in US can dramatically change the pain/gain ratio for manufacturing overseas.
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Old 02-08-2012, 09:09 PM
 
Location: NJ
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Precisely correct., slackjaw. Tires are labor intensive, so if we can get tire mfg back, other stuff should be even easier to reshore.
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Old 02-08-2012, 10:02 PM
 
Location: Palo Alto
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It's not the labor as much as the energy. If the net energy savings offset the net labor increase, it makes sense to produce locally.

I hypothesize that when oil prices rise and China runs out of slave labor, many of the jobs lost to China will return.

Tires are all about oil. They require tremendous energy to turn them from oil to tires. Factor in shipping costs and then distribution and supply chain logistics and it adds up quickly.
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Old 02-09-2012, 07:08 AM
 
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I think it depends on the industry, some things (like consumer electronics) have an inherent supply chain advantage being manufactured in Asia so even with the rising wages and logistics issues with lead time and transportation it can remain advantageous since your motherboards are coming from Taiwan, memory from Korea, etc.

Also as productivity continues to improve (more automation in manufacturing process) the amount of production cost directly related to labor decreases, so the difference in pay rate becomes less of a factor in getting your product out the door. It might have taken 10 people to build an elevator in 1995, but now it is 3 people and a couple machines.
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Old 02-09-2012, 07:35 AM
 
12,538 posts, read 14,622,342 times
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Google "bad Carlisle tires" and you will see why they needed to get the he11 out of China!

I lost a set of trailer tires a few years ago, less than 1,000 miles on them/4-5 months old. The whole set went bad on the same trip! Belts broke, tires blew apart on the highway. Carlisle replaced the whole set for free...
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Old 02-09-2012, 07:41 AM
 
Location: Sierra Vista, AZ
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They should just about have the Interstate finished there, that will make distribution easier. Another sign that the economy has turned the corner
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Old 02-09-2012, 08:11 AM
 
Location: Wartrace,TN
6,464 posts, read 10,147,744 times
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Quote:
Originally Posted by bobtn View Post
Precisely correct., slackjaw. Tires are labor intensive, so if we can get tire mfg back, other stuff should be even easier to reshore.
Tire production is increasingly less labor intensive. My former employer (Bridgestone) recently developed a fully automated tire building machine that just requires someone to feed it material. The components are all made by machine as well.At the new plant they built in Mexico they use workers to feeding material at the start of the process and nobody touches a tire until the final inspection.
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