Buying American, is it important?

[VAChesterfield]

Great discussion and dialog. I'd like to add a bit more to the insights others have been providing based upon my years of experience and training as a supply chain professional.

Think for a moment what advantages an "overseas" company has in establishing a "local" assembly plant, such as Toyota putting an assembly plant in Mississippi or the example MessickFarmEqu provided.

From a pure supply chain perspective, one of the most wasteful shipping costs is shipping air. You ship a fully assembled car, truck, tractor, and you are shipping lots of air ... air that no one is paying you to ship.

So the obvious first step is to break down your product into a low configuration and let the guy on the other end "assemble" it. Think in terms of those Chinese tractors in a can that get "assembled" over here. Now the manufacturer has saved a bunch of money in shipping costs, and usually starts thinking about what other costs it can squeeze out so it can better compete ... on the basis of cost alone. The typical next step is to build the 2nd tier components in the "home" country, and let the "locals" do all of the final assembly. Most of the cost (labor & materials) goes into the components anyway, and shipping components versus knocked down but almost fully assembled end products means you can cram lots more product into a container and ship even less air.

Companies also realize that by waiting until a customer (which could be a dealer) orders a specific tractor or automobile in a specific configuration (optional equipment) before final assembly, one can reduce inventory costs, especially the need to unload at a discount the turkeys you built that no one is buying. Toyota is a master at this game, known as "channel delay", and will even ship assembled autos from Japan to USA (lots of air) that only lack optional equipment ... equipment that gets added on here in the US once someone places an order -- and still make money.

As international companies get more sophisticated in playing this game (again, Toyota is the shining example), they establish engineering and design groups in the USA to ensure the people designing the products they sell here really do understand, and are a part of, our culture.

All the while this is going on the company gets to make increasing claims about building their product in America with American workers.

Furthermore, as MessickFarmEqu points out, some "overseas' companies truly have shifted or are in the process of shifting the lion's share of work to the US. The new Hyundai plant in Alabama is a good example. While Hyundai brings lots of parts in from overseas, they are steadily building up a network of 2nd and 3rd tier suppliers in local area. Carefully balancing what is made here and what is made there, they achieve cost efficiencies that allow them to outsell everyone. Plus, they can bring a new product or design that customers want to market faster than the competition thereby gaining market share.

Finally, I second MessickFarmEqu's suggestion to read "The World is Flat".

 

[redneckford]

I have been coached up by several of those large mfg's. They want you to tell the customer what they want to hear(no camera no picture, we can't let them see how little we do here) but Messick is so right in that many foreign name mfg's produce more product in the US than the American Branded Mfg's. The question that needs to be ask is why the foreign company is willing to take the high risk and large investment in America (long hours low return)and alot of American companies would rather make large investments in other countries such as Russia and China. The real answer is the consequences and repercussions that occur when a company has to make business decesions and hurt alot of people with their decession. If things get bad over there the American companies can take their marbles and come home without alot of political fallout. The same for the foreign companies that are here. Look who owns Nissan that is no longer a Jap company but many people think it is. We have the misconception that Jap company's build a better product which maybe true but it is because of quality control and engineering more than who was sweeping the floor after the robots get turned off in the evening. So if the robots are american made but are operating in China can we call the product proudly made with american labor. Like I said it all comes down to a spin on words. I can take any piece of equipment and make it work if I want it to, or I can take any piece of equipment and destroy it if I want to it boils down to me and the outcome.

 

[Podunkadunk]

The tractor debate has been beaten to a pulp on TBN...still, it's always fun to read new ideas and analogies

Almost everything is made in China these days as all of you know. I make it a point to try and notice where it's made nowadays before buying, but I fail miserably a lot of times. Most of the time, I have to buy the Chinese product, because there is no American made alternate

If an American company would produce the stuff, I'd be glad to pay more for it. I don't like the Government there and don't like supporting the people there that support it!

I've noticed a new trend/trick with manufacturers though. I just bought all new Baldwin locks and handles for my home. On the packaging, it has the normal "Made in China". However, they put an addendum saying that it's "Made in China, to strict Baldwin standards". Yeah...whatever. You'd think that with what I paid for the Baldwin's, they'd be made here in the U.S. WRONG! They shipped manufacturing to China, kept the same price that they used to sell them for when they were made here and are pocketing the major profit.

Disclaimer: I didn't see the "Made in China" portion of the box until I got home and had put several of them up. Boy was I angry!

Another point to ponder: What are we to do? I mean, if you don't want to buy Chinese products, you're pretty much hosed! There are no substitutes with most products. Almost every manufacturer is Chinese connected. I can't make the stuff myself. Manufacturers have made us captive consumers, because they know that even their competition is having the stuff made in China too. It's ridiculous and I'm tired of it.

My .02

Podunk

 

[SESS]

I find this thread interesting reading material-alot of different opinions and ways of looking at something! I think if one stopped and read every label of something we bought, we Americans would just be floored! One of the only thing I know for sure that is "made in america" is those veggies I just bought, cause I pulled them out of the groud myself! That pork on the table tonight-right out of my back yard so I know where that came from. Anything else is questionable.

My husband and I are Farmtrac dealers (PLEASE DO NOT LAUGH!) but when I began researching how in the heck did this Farmtrac mess happen, I came across this article about the relationship between Ford and Escort. As I have stated before, I am new to farming/agricultural where my husband was born and raised in this small rural town we live in. He has done nothing but tractor work and farming his whole life. With that said, I was raised to believe that "FORD" was like born in the USA! Not so after reading this article. If anyone has the time and energy, pick a brand of anything that you are committed to, then do the research back to when and where that brand came from. Startling results you will find! The internet is a great historian!

"I found this website interesting and informative regarding the relationship between Ford and Escort....

Automobiles Tractors India and agriculture farming tractors forms.

Escorts (Escort, Powertrac and Farmtrac)
Escorts Ltd began local manufacture of Ford tractors in 1971 in collaboration with Ford, UK and total production climbed steadily to 33000 in 1975 reaching 71000 by 1980. Ford (Ford - New Holland)was sold in 1992 Ford Motor Company proper quit the tractors business but the name was allowed to continue as per agreement till 2000, when Escort relabeled its Ford models under the Escort brand. Escort manufactures produces tractors in the 27-75 HP range and has already sold over 6 lac tractors. Its tractors are marketed under three brand names, Escort, Powertrac and Farmtrac.

Ford Tractors
Ford (formerly Ford Tractor Division) began producing Ford Tractors in India in 1972 with a tie up with Escorts. IN 1986 Ford acquired New Holland and tractor operations was transferred to Ford-New Holland and made into an independent corporation. In 1991, Fiat began an arranged purchase of Ford-New Holland that was completed in 1993 ending Ford Motor Company's long history of tractor production. The deal required that New Holland-FIAT stop using the Ford name. New Holland India Pvt began production of tractors in India in 1998."

 

[redneckford]

Thank G--- for the law that requires "truth" in labeling. cause if it did not say so on the package that lock could have been built Iran and just shipped from China. When is the last time you bought some steaks that said made in ----- did you lose your appiatite!!!! Words don't lie people do!!!!

 

[redneckford]

Messick i agree about the investment in America and how the Farmtrac situation has played out and why. But not everyone has $500000.00 to go into the tractor business and alot of people with $500000.00 has it because Dad or Grandpa left it to them, they didn't work for it. At some point we have got to get back to a solid capitalist benchmark in that those that do more with less longer are rewarded for their efforts. A man and a mule work long and hard and the man done without and sacrificed and accumulated a fortune----only in america the greatest country on earth!!!!

 

[Keef]

If John Deere moves their plant to China, I will cry in my soup.

On another note, York Peppermint Paddies are made in PA and it makes all the YPP's for the entire world (I believe). They are profitable in manuf. it in the US. However upper managment once to make even more money so they are closing the plant, laying off the employees and will be making the chocolate in Mexico in the next year or so.

 

[redneckford]

upper management---that's those over paid CEO's and the like???? until the stockholders (Hope Chinese investors don't own it all)take control and tell them to MFG in US and stay profitable they will run to where they can make a "fast" profit and up the pay of the CEO crowd. Better look who is buying all that JD stock right now,true they are making alot of profit on paper but!!!!!!!!!

 

[MessickFarmEqu]

If John Deere moves their plant to China, I will cry in my soup.
However upper managment once to make even more money so they are closing the plant, laying off the employees and will be making the chocolate in Mexico in the next year or so.

York Peperiment is a Hershey company, they've been moving manufacturing to Mexico and Canada slowly over the last several years. I'm about 15 minutes from Hershey, so we hear about it alot.


Get out the soup... Deere has had a manufacturing plant in China since the late 90's and is adding more.


Deere & Company, the world's largest manufacturer of agricultural equipment, said today that it plans to expand small tractor manufacturing in China by acquiring the Ningbo Benye Tractor & Automobile Manufacture Co. Ltd. business, located in Ningbo in southern China.

Benye factory

Deere said it has signed a definitive agreement to purchase the Benye business and is seeking final review of the transaction by government approval authorities in China.
Through the acquisition, Deere will expand the product line offered to Chinese farmers and enhance its worldwide capacity to produce low horsepower tractors. Benye mainly builds tractors in the 20 to 50 horsepower range while Deere currently builds tractors in the 60 to 120 horsepower range at its current China joint venture tractor factory, located in Tianjin.

"We do have an ambition to grow both our domestic and export market in China," said David Everitt, president of Deere's Agricultural Division in North America

 

[redneckford]

Messick----- get a bandaid for that finger---- you are going to get a blister on it hitting that delete button to get rid of all that hate mail!!!!Some of them can't stand the truth----much less the facts!!!!