The lingering trade war launched by the U.S. against other countries of the world has forced global enterprises to consider restructuring supply chains that mostly involve contract manufacturers in Asia. With a global supply chain revolution on the way, JHK’s Report to Customers will share its insights into the transition.
Under the traditional division of labor, a single piece of cold-forged aircraft parts can be transferred across many borders and then destined to Boeing or Airbus till it is finished. This is the landscape that manufacturers from all over the world in the era of globalization have been familiar with.
However, such an offshoring process may have reached a time point to be changed, as ever more international enterprises have found it inefficient. It is especially significant when wages in Asian developing countries have continuously grown, while rising protectionism worldwide and increasing tariffs by the U.S. and other nations have added salt to injury of the players with production facilities outside of their homelands.
Simply speaking, the global supply chain revolution getting underway is to see long, complex cross-border supply chains be broken into smaller and “more independent” ones, to enable multinational enterprises to better adapt themselves to government regulations—literally duties—and market demands with improved efficiency and significant flexibility.
In other words, to the Taiwanese metal industry, for example, the revolution is likely to bring in change in the way that a single supplier will be asked to serve foreign customers like a separate supply chain, to provide readily available products and services on demand locally and for nearby markets. To that end, integrated manufacturing facility will be required.
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