People who say it is impossible to move production from one country to another don't understand what the word 'impossible' means.
That's also the answer to 'can we move production under the sea?'
What I think most people mean is that moving production is impractical, e.g., that there is no realistic incentive that justifies making the investment and so for that reason nobody will make the investment, and production will not move, etc.
It would be more effective to argue that the required investment is smaller than expected, and some particular entity does have an incentive to make the investment after all, etc.
Also it is not limited to electronics - as others have pointed out, Addidas moved automation back to Germany.
Says who? Addidas is moving its robot factory into Germany and the US. The perceive benefit you see from China doesn't exist once we have proper automation.
http://fortune.com/2016/05/25/adidas-robot-speedfactories/
http://www.theguardian.com/world/2016/may/25/adidas-to-sell-...
>Try sourcing a new chip in the states and then try over there.
Fabs are different because western nations have strict environmental laws. China's big benefit with fabs is its willingness to pollute its lands and poison its people for us. This is a negative all around and the sooner we get fabs out of China and into environmentally responsible countries and using environmentally responsible methods the better.
There are those that are seriously concerned about China's ability to compete, including the Chinese Government.
The solution going forward is specialization. We handed manufacturing to China while our service sector exploded. Let each country produce those goods it does best and then trade with one another. Why bring production back to the US? Only if it makes sense to do so.
1: http://www.npr.org/series/248799434/planet-moneys-t-shirt-pr...
2: http://www.npr.org/sections/money/2013/12/04/247360787/our-i...
The supply chain to support making shoes seems like it would be MUCH smaller.
It would take a relatively small tweak to import duties to make most types of outsourcing uneconomical.
Germany, in fact, is in the business of producing the machinery that is then used in other countries to produce your phones, tanks, ice cream cones.
https://erdbeerjoghurt150g.files.wordpress.com/2008/06/joghu...
Example: Zara produces in Spain as high fashion items have a very short shelf life, whereas a container with skirts takes a bit to come from China to Europe.
If I gain an advantage by producing closer to my buyer, I'll do it.
Just-In-Time production becomes even tighter. That Amazon Prime 24h delivery item could come hot of the press.
Their Bangladesh suppliers have ~300,000 workers vs. ~6,000 in Spain [0]. To counter your point, it seems that a piece of clothing manufactured in China will be shipped to Spain, quality controlled, tagged, fitted with RF-ID and then sent back to China for selling [1]. So it doesn't seem to follow the model you suggest where proximity matters.
[0] http://www.elespanol.com/economia/20160222/104239851_0.html [1] http://economia.elpais.com/economia/2015/03/17/actualidad/14...
Rationale: you now just need to bulk order the raw materials / components and "feed the machine".
We aren't there yet, but jeez we seem to be racing there quick?
once that happens it's a 'snowball', if the price is right the supply chain will catch up.
PS: see the link posted in another comment: http://www.theguardian.com/world/2016/may/25/adidas-to-sell-...
Energy costs also become increasingly relevant as labor costs drop to a smaller fraction. Why not set up in iceland where geothermal electricity is free.
I guess you could always pay off the local warlord, then pay for your own roads, and all the rest... But perhaps better to have a government take care of it for you?
Getting smart people to come on contract to live in luxury and service your robots won't be hard. Why on earth would you live in a dingy NYC or San Francisco apartment if you could go somewhere and as merely an engineer be waited on hand and foot in a luxury condo while saving up bank. Go golfing after work every day for free.
1. Security
2. Friends
3. Family
4. Security
I've lived overseas in Cambodia and Taiwan. The lower cost of living, warm weather, and challenges of living in a different culture can make life pretty enjoyable.
I chose both places carefully and visited before deciding to move. I still visit the US once a year and my vacations now take me to places I would never go if I lived in the US. A weekend trip to the Philippines, Vietnam, South Korea, China, or Japan is feasible from Taiwan. From Cambodia, you're right next to Vietnam, Thailand, and Laos, all safe places if you read up on what to watch out for.
Taiwan is much more developed than Cambodia, and yes, are nothing like Somalia. That's not a place I would choose to live, myself.