The challenges of decoupling manufacturing from China

Any relocation of American industry back to the United States will also leave China with major collateral damage. Regions where US companies abandon could go into mass recessions and high unemployment. This could even lead to civil unrest in China.

The shipping and logistic industries would collapse, which could have dire economic consequences.

The reality of any corporation being able to physically relocate back to the United States would have to be examined on a case-by-case basis.

The whole concept of manufacturing in China was based upon the ideology of building mass manufacturing facilities with economies of scale so large, needs rethinking. Maybe the Trump Tariffs are a call to return to manufacturing in a region for a region and surrounding market, ie. The United States. Economies of scale are not everything within a company. Smaller scale manufacturing brings economic prosperity to the areas that surround the business.

On the other side, without China consumer prices will be much higher. There is a need to examine the whole issue, industry by industry. Its not all economics, social value judgements need to be made that corporations forgot back in 1990.

This is the management challenge for the second half of the 2020s and 2030s. Smaller, leaner, flexible manufacturing, where corporations may have to themselves be decoupled from conglomerates – just like the Seven sisters, the telephone companies before them, so companies can once again serve their communities.

Management must go back to the future to survive any decoupling from China.