October 21, 2020
October 2020 eNewsletter - Commerce Department Requests More Reshoring from China, Reshoring Initiative Responds
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| October 2020 E-News: Commerce Department Requests More Reshoring from China, Reshoring Initiative Responds Investment Advisory Council (IAC) of the U.S. Department of Commerce The IAC met on September 10, 2020, reporting on a year’s work to Commerce Secretary Wilbur Ross, Assistant Secretary for Global Markets Ian Steff and Deputy Under Secretary for Policy Greg Kalbaugh. Traditionally, the IAC has focused primarily on FDI (foreign direct investment), but at this meeting reshoring received at least equal billing. In fact, Secretary Ross called for accelerated reshoring from China. The Reshoring Initiative’s Harry Moser, a Council member, submitted a proposal to achieve Secretary Ross’ goal. Not waiting for Washington, the Reshoring Initiative has launched the Import Substitution Program (ISP), helping companies reshore and increase orders.The ISP is a great way for companies to rebuild their order books and recover from the COVID-19 crisis while they help the country at the same time. Six MEPs (Manufacturing Extension Partnerships) and one state EDO (Economic Development Organization) offer ISP, which also is available directly to companies. The Reshoring Initiative soon will be working with 100 companies. The ISP package includes the following: Import Substitution Program (ISP): Identifies major importers of what a company produces. TCO Estimator An online application to help companies make better sourcing decisions about offshore vs. domestic sourcing and sell against imports. This tool already has helped one company win a $60 million order over a Chinese competitor. Use the TCO Estimator to convince the importers to reshore and source from you. How to participate:
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| More Tools and Tactics to Reshore Roadmap to self-sufficient Industrial Base: IMTS offers a step-by-step analysis. Additionally, follow our 19-article IMTS.com series, underway on ReBuilding the Supply Chain. Reshoring Is Creating Opportunities For North American Manufacturers: Follow these recommendations to capitalize on reshoring. Underreported Trends That Will Accelerate Reshoring: 1. Implement smaller local factories and warehouses. 2. Integrate automation. 3. Offer apprenticeships and mentorship programs. Strategic Reshoring: A Literature Review: Extensive discussion of the trends to date. | ||||||||||
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| Government and Grass Roots Initiatives to Accelerate Reshoring U.S. Government Announces $1 Billion Investment in Researching Industry 4.0 Technologies: "…the U.S. is providing more than $1 billion toward establishing 12 new research and development hubs for AI and quantum information science (QIS) nationwide. IPC Issues Statement on NDAA Provisions Aimed at Bringing Resiliency and Security to Supply Chains: In response to national security threats, the FY 2021 National Defense Authorization Act (NDAA) created provisions aimed at improving the security of electronics purchased by the Defense Department by developing an affirmative list of allied, trusted countries from which the DoD can source boards and assemblies. The provisions hold bipartisan support in the U.S. Congress, offering the U.S. "an opportunity to begin to follow through on its commitment to a more robust industrial base and unquestioned national security." Competing With China: A Strategic Framework: China will likely be the biggest business disruptor of the 2020s, but the discussion about how to respond has yet to take shape. A strategic framework should rebalance the global supply chains, bolster competitiveness, adjust to China’s market size and solidify the West’s appeal." Reassuring the Reshoring – A Cyber Risk Management Proposal: The U.S and foreign governments are taking actions (listed in the article) to promote reshoring. Cybersecurity management and insurance are another piece of the puzzle to ensure success. U.S. to bolster Latin American supply chains: There is a "new ‘Back to the Americas’ initiative, which the White House has launched with a clear target in mind: dragging Asian supply chains to Latin America and the Caribbean, using funds from the Development Finance Corporation(DFC) to cover company relocation costs." The Manufacturing USA Institutes call for the creation of a "National Manufacturing Guard": The event aimed to define:
Duff & Phelps Reshoring Index: Click on the article link to view the interactive version of this map of those industries most likely to reshore. | ||||||||||
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| U.S. and European firms face $1 trillion in costs to relocate their Chinese supply chains, BofA says: The risks and costs are real, but "the bank argues that such a move would likely be beneficial for companies in the long term." Global Risk Mitigation: Is it time to reshore? "If there’s one lesson to learn, it’s that supply chains must now become more resilient. And as more companies consider reshoring to the United States, there are many things to consider beyond just making the economics work." | ||||||||||
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| Upcoming Events October 22-23 – American Manufacturing Summit October 26-27 – AME Annual Conference October 28 – UEDA (Utility Economic Development Association) October 29 – Manufacture CT October 29 – AMT MTForecast November 18 – NTMA Fall Conference | ||||||||||
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| The Reshoring Initiative seeks volunteers to help enable reshoring. We are looking for several experienced manufacturers to commit 5 or 10 hours/week for at least a few months. Helpful qualifications include Microsoft Excel competence, general manufacturing knowledge and comfort talking to other manufacturers by phone or via Zoom. Successful volunteer work could lead to paid part-time contract work. Email info@reshorenow.org for inquiries. Thanks to all our readers, our sponsors and the companies who are using TCO to reshore. Sincerely, Harry Moser, Founder, Reshoring Initiative Millar Kelley, Newsletter Editor and Research Analyst Join ourmailing list. View past eNewsletters. | ||||||||||
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