Tom Paine 1949
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This non-partisan article outlines the continuing surge in high-tech factory construction and explains why it is happening now …
by Wolf Richter • Sep 3, 2023
Driven by manufacturing plants for technologically advanced, high-value products. Automation is the great equalizer.
By Wolf Richter, Sept. 3, 2023
Spending on construction projects for manufacturing plants in the US started breaking out of its long doldrums in January 2021…. Monthly construction spending for factories began to spike and in July set a new record of nearly $17 billion [from 6 billion per month a year earlier] … according to the Census Bureau on Friday.
We’ve been hearing it in the news and in corporate reports: Semiconductor plants, EV plants – Tesla, legacy automakers, and startup companies are plowing many billions of dollars into ramping up manufacturing – component makers, makers of computer, electronic, and electrical equipment, etc. The latter bunch are big drivers behind the surge of factory construction.
All of them are technologically advanced industries with high-value outputs. Forget T-shirts and plastic toys.
And all of them use highly automated factories. Industrial robots cost the same in the US as in China. They’re the great equalizer when it comes to costs.
There is still a huge amount of manufacturing in the US. By output, the US is the second largest manufacturing country behind China, and larger than Germany, Japan, and South Korea combined.
The problem is that the US has fallen far behind China, and that many industries are dependent on imports from China and other countries. When covid tangled up the supply chains, suddenly there were massive shortages of the most needed products, including semiconductors. So that was a wakeup call.
In addition, as trade relations between the US and China have soured, companies are seeing new risks in being dependent on China.
The majority of cars and trucks sold in the US are assembled in a factory in the US. All major foreign brands have assembly plants in the US, including BMW and Mercedes. Hondas built in the US have among the highest US content. Tesla makes vehicles in the US including for export. And yet, component shortages, triggered by semiconductor shortages, caused the worst vehicle shortages ever. So time to reevaluate things…
Construction Spending for Factories Soars, after Decades in the Doldrums | Wolf Street
by Wolf Richter • Sep 3, 2023
Driven by manufacturing plants for technologically advanced, high-value products. Automation is the great equalizer.
By Wolf Richter, Sept. 3, 2023
Spending on construction projects for manufacturing plants in the US started breaking out of its long doldrums in January 2021…. Monthly construction spending for factories began to spike and in July set a new record of nearly $17 billion [from 6 billion per month a year earlier] … according to the Census Bureau on Friday.
- Up by 186% over the 30 months from January 2021 through July 2023.
- Up by 148% over the 24 months from July 2021 through July 2023.
We’ve been hearing it in the news and in corporate reports: Semiconductor plants, EV plants – Tesla, legacy automakers, and startup companies are plowing many billions of dollars into ramping up manufacturing – component makers, makers of computer, electronic, and electrical equipment, etc. The latter bunch are big drivers behind the surge of factory construction.
All of them are technologically advanced industries with high-value outputs. Forget T-shirts and plastic toys.
And all of them use highly automated factories. Industrial robots cost the same in the US as in China. They’re the great equalizer when it comes to costs.
There is still a huge amount of manufacturing in the US. By output, the US is the second largest manufacturing country behind China, and larger than Germany, Japan, and South Korea combined.
The problem is that the US has fallen far behind China, and that many industries are dependent on imports from China and other countries. When covid tangled up the supply chains, suddenly there were massive shortages of the most needed products, including semiconductors. So that was a wakeup call.
In addition, as trade relations between the US and China have soured, companies are seeing new risks in being dependent on China.
The majority of cars and trucks sold in the US are assembled in a factory in the US. All major foreign brands have assembly plants in the US, including BMW and Mercedes. Hondas built in the US have among the highest US content. Tesla makes vehicles in the US including for export. And yet, component shortages, triggered by semiconductor shortages, caused the worst vehicle shortages ever. So time to reevaluate things…
Construction Spending for Factories Soars, after Decades in the Doldrums | Wolf Street
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