American producers and manufactures are trying to find ways to move their business away from China. That's according to a new study from the consulting firm, Kearney.
New numbers show U.S. companies are moving their production out of China. For many, the COVID-19 outbreak highlights the need to diversify away from the Communist nation.
American producers and manufactures are (and have been) on the lookout for new trading partners. Yuri Castano is with Kearney, a manufacturing consulting firm whose recent study (their seventh annual Reshoring Index)highlights one big trend.
“Trade is diversifying away from China in Asia,” Castano told KTRH. “So, Vietnam, Malaysia, has increasingly been taking a bigger share of the manufacturing. But what happened with the Trade War is that the trend accelerated a lot,”
Castano says increased tariffs as part of the 2019 Trade War made it hard for U.S. companies to justify the costs. As a result, China lost tens of billions of dollars’ worth of trade. The recent viral outbreak is likely to speed up the same trend. One challenge, though: bringing those manufacturing jobs back to the United States. Castano says labor costs are still far cheaper in parts of Asia and Mexico.