Made in USA: Works for GE, Can for Apple, too
Industrial conglomerate General Electric is revitalizing consumer appliance (CA) manufacturing at its Louisville, Kentucky facility, where products once sourced from China are now being made, at lower cost mind you — including water heaters, clothes washers, dish washers and more. Although it might be an exaggeration call manufacturing re-shoring a boom, GE and, coming in 2013, Apple (video below) are both riding the Made in USA wave.
If you have CNC, injection mold and/or welding skills, the job market is looking pretty good. This good fortune is due to the slowly improving economy, which derives in large part to the revival in American manufacturing, which has been one of the strongest segments of the economy over the last four years.
Whereas CA and computer manufacturing once employed hundreds of thousand, the jobs now coming back number in the hundreds and thousands. Component, supplier and contractor tie ins perhaps double the headcount.
Mac: Made in USA again
With Apple saying one Mac product line is coming back to the US in 2013, little wonder then that Elk Grove, California, a city that once hosted iMac and Mac Pro production, wants Apple to manufacture computers there again.
“We’d be thrilled to see additional production return back to that facility,” said Elk Grove Economic Development Director Randy Starbuck.
Wherever Apple manufactures/assembles that single Mac product line — speculation is focussed on the Mac Pro and iMac — the discrete local employment boost is likely to be modest. For example, tens of thousands once worked at GE’s Louisville plant where several thousand now punch a card.
That said, Apple or its contractor will likely only employ a few hundred people. Again, however, the value add for the local economy could be big vis-a-vis services, transportation, hospitality, etc.
Made in USA is about making money
The important thing to bear in mind when discussing a revival in American manufacturing is that companies will only do it if they make more money. An interesting example of that is GE, which is now building a water heater in Kentucky that the company previously sourced from China.
In order to make the device here, GE had to redesign it to simplify assembly and thereby reduce labor costs, which resulted in a 20 percent lower component cost and allowed them to cut their final price by $200. Moreover, the company didn’t do that out of generosity and it’s a sure bet they’re making more per unit as a result.
Yes, bringing manufacturing back to the US is working for GE and can work for Apple, too…
What’s your take?